Why your employer may deny you a company card

Your Business Credit columnist Elaine Pofeldt
Elaine Pofeldt is a journalist whose articles on entrepreneurship and careers have appeared in Fortune, Working Mother, Money and many other publications. She is a former senior editor at Fortune Small Business magazine and an entrepreneur herself, as co-founder of 200kfreelancer.com, a website for independent professionals. She writes "Your Business Credit," a weekly column about small business and credit, for CreditCards.com.

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Question Dear Your Business Credit,
I am not an employer. I am considering employment at a new company. I need a few good reasons they should issue me a credit card, which they have declined thus far. The expenses I will be incurring are significant. They include airline tickets, rental cars and extended stays in hotels. -- William

Answer Dear William,
Although I usually only answer questions from small business owners in this column, your question is relevant to owners, so I'm going to tackle it.

Many business owners give a lot of thought to whether they should offer a company credit card to their employees. The decision usually rests on the answers to three questions:

  1. Will it help them profit more from their business?
  2. Will they save time by offering credit cards?
  3. What are the risks?

Owners looking to offer company cards should consider all three angles. And employees who want to get a company card need to look at these issues like an owner would to come up with the strongest case for themselves.

Let's look at the money angle first. Many owners use a personal card for business expenses out of habit, even though that isn't what most experts recommend. In some cases, these entrepreneurs may get access to a better rewards program or one that is tailored to common business expenses, such as office supplies or gasoline, by choosing a business credit card instead. And they may be able to give cards to employees for no extra fee, depending on the card. The points the employees accrue can then potentially be redeemed by the business owner.

Offering a small-business card can also be a win for a small company at tax time. One of the quickest, easiest ways to keep tabs on employees' expenses is if the owner has access to employees' spending records through a single credit card account. If employees are submitting receipts from a hodgepodge of personal accounts, record-keeping can be more complicated.

Using company credit cards can also make it easier for an owner to set spending limits and to convey what types of expenses the company is and isn't willing to cover. Some cards are set up so that employees can only use them at approved categories of businesses, such as hotels, and not others, such as liquor stores.

So what holds back owners from issuing company cards? In some cases, they are happy with a current card that doesn't give them the option to issue additional cards. They don't want to change from a card that has low fees or from which they have racked up a lot of points. In other cases, they may have credit problems that prevent them from adding cards for employees at the moment.

Then there's the issue of trust. Under the agreements most entrepreneurs must sign to get small-business cards and issue them to their team, they could be held liable if an irresponsible employee runs up a lot of charges and flies the coop. Owners need to know they can really trust employees before they issue credit cards. There's only one way to develop trust: Getting to know each other over time. The job interview process is just the beginning of that -- not a substitute for it.

If I were you, I'd ask yourself why you have doubts about taking this job without getting a company credit card. Is the salary being offered too low to allow you to comfortably carry those expenses on your credit card until you get reimbursed? If so you may need to negotiate for higher pay -- and explain why. Once you get the job, you'll have many opportunities to prove the owners can trust you enough to issue a card, assuming they are inclined to offer them at all.

See related: Should I give more employees company cards?, Is employee responsible for boss's default?, 6 questions to ask about your company credit card

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Updated: 03-23-2019