Why are Prepaid Cards Ideal for Startups and Corporates?

Background:

Starting a new business is a matter of great excitement for an entrepreneur. But, it brings its own share of challenges. There are a lot many new things that you may be dealing with; you may be doing many things for the first time.

You may have hired some new people, and they may be required to travel to grow your business. Now to support their travel expenses, you have to give them either cash or corporate credit cards. In both cases, there are chances of fraud, and of course, it takes time to build trust. The use of prepaid cards is one way out.

What are Prepaid Cards?

Prepaid cards are a form of plastic currency, quite similar in looks to a credit or debit card. However, there are many differences when it comes to using prepaid cards. Unlike a debit card, a prepaid card is not linked to any bank account. And unlike a debit card, you are not borrowing any money.

A prepaid card is much simpler to understand. You load some money into the card, and then that money can be used to make travel and stay bookings, payments on retail shops, and online transactions. In case of need, one may withdraw cash from ATM, just like a normal ATM card. And once the amount is over, you may reload the amount. It’s that simple!

The problem of Tracking Expenses in Startups

As mentioned above, a startup has to face a lot of challenges that are new for the firm and the entrepreneur. One of the major issues is tracking expenses. When salespeople travel to other cities for official work, they make some expenses on the company’s behalf and present the receipt to claim reimbursement. The finance team checks these expenses and processes them further. This is a tedious and time-consuming process, and often there are disputes, which lead to deductions and a bad taste in the mouth.

Giving cash or corporate credit cards may lead to misuse and overspending. Also, in case you miss the deadline on credit card payment, you have to pay heavy interest.

Smart Alternative to Track Expense through Prepaid Cards

Now, you have a smart and simple way to track expenses and avoid unnecessary hassles. Give your employees a prepaid card, which they may use for making payments, or withdrawing cash. All the purchases made on the card are automatically recorded and reflected on the dashboard in real-time. So, you must just take a print and submit it to finance.

There is no need to collect bills and receipts. What’s more, you set an individual limit to each card, so there is no risk of overspending. You can also restrict the outlets, where the card can be used, so there is no risk of misuse. Funds can be loaded in the card, as and when required. This makes the entire the entire process very smooth, quick, and transparent for everyone.

Benefits of Prepaid Cards for Startups and corporate:

A prepaid card works wonders for not only startups but for corporates as well. So, if you are looking to improve your expense management system, then this blog is for you. There are several benefits to using prepaid cards, which are listed below:

1.    Easy to control and track expenses:

With a prepaid card, you may set a limit for each individual. You can also block the cards at outlets, where you don’t want them to be used. Also, as soon as the card is swiped, the expense is reflected on a dashboard. The user and admin can view this dashboard individually.

While the user sees the expenses and takes a print to submit as a travel report, the owner may use it to analyze the pattern of expenses. After the travel, the unutilized funds can be credited back into the company’s accounts, without any delay. This gives the owner a better control over expenses.

2.    Save Operational Costs:

Earlier, to avoid cash payments to employees, companies used paper cheques or bank transfers. However, these methods involve charges, which may be quite high sometimes. Also, if the employee is working in some remote area, sending cheques through couriers may not be safe and convenient.

However, in the case of prepaid cards, all these problems are taken care of, without any charges, risk, or inconvenience. And unlike credit card, there is no risk of delayed payments and interest charges.

3.    Safe and Secure:

Travel carrying cash is very unsafe. It may get lost or stolen. Once gone, it’s gone forever. A credit card also, once lost or stolen runs the risk of being misused. Losing a cheque may leak confidential information about your company bank account. A company may have to pay heavily for such losses.

But, a prepaid card is very simple, safe and secure. Even if a card is lost or stolen, all you need to do is call the company and block the card. The funds are transferred to the new card, Even if you delay in reporting the loss, the potential loss would be limited, since the card has a limited amount and can be used on restricted outlets only.

4.    Customized to fit your requirements:

You may be a start-up or a Corporate, you have your own expectations from, in terms of managing your expenses. Prepaid cards score over other payment options on this account as well. You may customize the card with your company colors and logo, which gives better visibility.

Some banks even allow you to mention the name of the employee over the card. This is a great motivation for the employee. In addition, you may also choose among various options, like physical prepaid cards, virtual prepaid debit cards, or even contactless cards. There are no extra or hidden charges. You may access your account can be accessed at any time through the website or mobile app.

5.    Easy and quick process:

First of all, signing up is very easy and quick. The 24x7 helpline is there to support you with quick joining, enroll employees, issue cards, and generate statements. And all this is very easy and quick. In case your employees are traveling, and there is an emergency, you can transfer funds very easily. No need for the employees to use their personal funds or borrow money from someone else.

6.    Conclusion:

Every company, be it a startup or established corporate likes to have an expense management system, that is smooth, transparent, and hassle-free, with the least or ideally zero additional cost. Prepaid cards give the complete command in your hands to manage the expenses in an easy, transparent, and hassle-free manner.