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Corporate cards

“ An SME typically wants a payment solution and a corporate card in one.

Something I would always look for as an SME would be a card that I could upgrade as I grow or the company profile changes

At one end of the spectrum, an SME client might want just want a piece of plastic for a payment. This could simply be to move the programme away from employees having to use their personal cards and then constantly chasing for their paper expense claims be paid off in sufficient time so that their credit rating is not affected. At this level, a very basic card – similar

to what is issued in the consumer market – may be adequate. Klein continues, “An SME typically wants a payment solution and a corporate card in one. Something I would always look for as an SME would be a card that I could upgrade as I grow or the company profile changes.” Diners’ Edgerton believes that a lodge

card can be a good starting point for a company new to cards. “Companies can start out with lodge to keep track of air expenses as a way of beginning a programme,” he says. Lodge is the industry shorthand for a

centrally settled account. A lodge card works by a corporate client – or, in some cases, a subsidiary or a department of a corporate client – lodging a number identifying the account with its travel management company. It is commonly used to charge large

ticket price items such as air tickets although it is also often used for rail and, sometimes, hotel payments. As well as removing the need for

travellers to put such expensive items as flight tickets on their individual cards, lodge cards allow the company to

purchase travel for those who might not have cards, namely new employees, infrequent travellers or contract staff. Moreover, booking and paying for travel with the appointed TMC is the best way of ensuring compliance with travel policy. Inmarsat, the global satellite

communications company, is typical in its use of lodge. Sanjay Patel, head of finance systems and operations, says, “We have a lodge card for large purchases such as air because we need a tight pre- approval process and automated invoicing. I don’t want to have my team spending time chasing invoices.” Patel, who is responsible for accounts

payable and is in charge of the card programme, used one bank’s corporate cards for years but changed suppliers to Bank of America (BOA). The move came when he was charged to create a global programme after his CEO decided he wanted to integrate the organisation’s different businesses and his erstwhile provider was unable to offer cards in any currency other than sterling. Patel had to start his corporate card

programme over again but has been so pleased with BOA’s reporting tool and customer service that he is about to move his lodge programme to them as well. It is not at all unusual for corporates to

use different cards for different purposes. HRG’s director of ancillary products, Brian Merry, explains. “Lodge has been in place for 28 years or so and is still going strong. However, whereas 28 years ago lodge was a standalone product it’s now generally seen as a supporting product to the corporate card programme. “Some clients will instruct all expenditure

to be on the corporate card – some say put all hotel and restaurant on card but all air goes on lodge. “The advantage of the lodge over

invoicing is generally extended credit, probably an additional two-week credit over TMC credit capability. However, the benefit of corporate card over the lodge is both individual accountability and the streamlining and accounting of all T&E into one process,” adds Merry. Barclaycard’s head of public sector, Iain Currie, agrees. “A corporate card gives personal accountability. You can tie every unit of spend from leaving the house to going back home plus the few cash bits and it’s me that justified them.” Tony Pilcher says, “By having a card then

you’re involving the travellers themselves. And traveller engagement gets them to understand the integral part they play in the success of the company through its strategy of controlling costs.” Corporate cards may once have been conceived as a payment mechanism but


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