BACK

Your Business Credit

Why your employer may deny you a company card

Summary

A small business has to weigh several factors before giving a new employee a company card for travel expenses. Understanding them can help employees and small business owners both start off on better footing.

The editorial content below is based solely on the objective assessment of our writers and is not driven by advertising dollars. However, we may receive compensation when you click on links to products from our partners. Learn more about our advertising policy.

The content on this page is accurate as of the posting date; however, some of the offers mentioned may have expired. Please see the bank’s website for the most current version of card offers; and please review our list of best credit cards, or use our CardMatch™ tool to find cards matched to your needs.

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

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.

Check out all the answers from our credit card experts.

Ask Elaine a question.

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

What’s up next?

In Your Business Credit

Minimize costs of card acceptance without surcharges

Interchange fees can add up for small businesses, but surcharging customers isn’t the answer. There are other ways to mitigate card acceptance costs

Published: December 15, 2014

See more stories
Credit Card Rate Report Updated: June 19th, 2019
Business
15.61%
Airline
17.54%
Cash Back
17.68%
Reward
17.57%
Student
17.79%

Questions or comments?

Contact us

Editorial corrections policies

Learn more

Join the Discussion

We encourage an active and insightful conversation among our users. Please help us keep our community civil and respectful. For your safety, do not disclose confidential or personal information such as bank account numbers or social security numbers. Anything you post may be disclosed, published, transmitted or reused.

The editorial content on CreditCards.com is not sponsored by any bank or credit card issuer. The journalists in the editorial department are separate from the company’s business operations. The comments posted below are not provided, reviewed or approved by any company mentioned in our editorial content. Additionally, any companies mentioned in the content do not assume responsibility to ensure that all posts and/or questions are answered.