Can Business Prepaid Cards Eliminate The Inefficiencies Of Cash?
In our first bout of expense payment method head-to-head comparisons, we are going to compare business prepaid cards to the stalwart expense payment method, cash. As the oldest payment method cash will always have a place in your business, but reducing the use of cash will greatly reduce exposure to abuse, loss, and interruptions that impact productivity. Let’s get started.
The Pro’s Of Using Cash – Why Cash Is King
Cash delivers many conveniences that business owners and employees love:
- It can be used everywhere
- You can dole out exact amounts, so you know your exposure
- Thanks to the “petty cash” drawer, it is readily available
- It is highly liquid, so your precious cash flow funds aren’t tied up
- Returns will deliver cash back
The Cons Of Using Cash – What You Don’t Know Could Be Costing You
The convenience of cash also comes with many drawbacks that business owner’s either accept or aren’t aware of the extent it is costing them:
- Prone to abuse or waste – Employees can make unauthorized purchases
- Borderline waste or abuse is accepted by owners but the extent is unknown
- Can’t control where or how the funds are used
- No good tracking, including forgotten or lost receipts
- Poor visibility – Reconciliation could be monthly, can’t see issues
- Decreases productivity – interrupts employee & manager to get funds
How Business Prepaid Cards (BPC) Solve Cash’s Deficiencies
- Universally accepted (anywhere credit cards are accepted)
- Employee cards are readily available and convenient, so no interruptions
- Specify dollar amount– set spending limits by employee, day, week or month
- Control the types of purchases (merchants) through spending categories
- Visibility & reporting – all purchases are accounted for in real-time
- Eliminates most known and unknown waste via visibility & controls
- Returned funds are returned to the card or account
- Receipt capture via mobile app at the POS eliminates accounting gaps
Conclusion: Reduce Use Of Cash To Eliminate Losses
Every business has different needs in how it manages employee expenses. Cash provides a lot of instant convenience benefits, at the expense of decreased visibility, lag in accounting & reconciliation, and is prone to abuse. Business prepaid cards replicate many of the pros of cash while mitigating the cons. There may still be situations where cash cannot be replaced, but implementing a business prepaid card program into your business could provide greater control, eliminate inefficiencies and prevent waste and abuse that you may not be tracking.
Compare business prepaid card features and get started on a business prepaid card free trial today!