Who else can use corporate credit cards?
Corporate cards aren’t always limited to private entities. Government agencies and nonprofit organizations could find these cards helpful as well.
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Corporate credit cards are designed for companies with revenue in the millions and with a large number of employees. That’s because corporate cards come with features like employee spending tracking to reduce fraud and misuse, manual-task automation and streamlining finance management.
The size of the company these cards are meant for is the main differences between corporate and small business credit cards. This table explains a few other key differences.
Corporate credit cards | Small business credit cards | |
---|---|---|
Who are they for? | Issued to large companies and corporations with more than $1 million in revenue. | Designed for the small business owner with one or two employees with access to a company credit card. |
Who is liable? | The company is entirely liable for all debt. Before issuing the card, the bank reviews the company’s finances and uses some of its assets as collateral. However, some banks will tailor cards allowing you to choose your liability options. | In most cases, you are personally liable for any debt you incur on these business cards. |
Do they report to personal credit? | No. Your personal credit won’t be affected. Instead, all card activity is reported to business credit bureaus. | Depending on which card you choose, the bank may report to personal and business credit bureaus. Your personal credit can take a hit if your business runs into financial trouble. |
Can I monitor employee spending? | Yes. This is the main perk of this type of card, especially if your business has several employees with access to business cards. You can easily track spending for each employee and approve reimbursements. | Some banks offer spending management tools for small business credit cards. However, these are not usually as efficient as the custom-designed software used by corporate credit cards. |
Corporate cards aren’t always limited to private entities. Government agencies and nonprofit organizations could find these cards helpful as well.
A corporate credit card comes with some benefits, but there are downsides as well.
The eligibility criteria vary between providers. In general, you need to have a revenue of at least $1 million, and some providers may even require a certain number of employees to use the card, to charge a certain amount each year and your company to be registered as an S or C corporation.
If you need a large number of employee credit cards and if your business has a revenue of at least $1 million, a corporate credit card may be a better choice than a small business credit card.
Before you choose a corporate card, here’s what to keep in mind:
Corporate liability is most common with corporate credit cards. But if your business spends a lot and has many employees, some banks may tailor a liability program specific to your business.
JP Morgan Chase offers six corporate cards and are sold as commercial credit cards:
If your business is not ready for a corporate card, consider applying for a small business credit card.
With more invoices, employee credit cards and cashflow, your small business may be ready for a corporate card. These cards can help your business process payments easier and manage employee spending.
If your small business is still making less than $1 million annually, consider comparing small business credit cards.
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