GLOBAL ACCESS
expense management process, of which one example is automatically pre-populating an online expense reporting system with transaction information from the card. “Many of these countries are still developing their automated expense management capability,” says Alan Gillies, vice- president of UK sales for global corporate payments at American Express. “The whole buying cycle of online purchasing and expense processing remains fragmented.” Step one in a card programme
expansion, therefore, is to resolve the underlying basics of the wider travel and expense programme. “Get your policy nailed down first,” says David Harrison, vice-president of Visa Commercial at Visa Europe. “There will always be cultural issues, so it is important to have a strong policy that allows for no negotiation.” Others advocate a more softly-softly attitude. “You have to sell the benefits of the programme locally,” says Amex’s Gillies. “Applying a mandatory approach won’t work with all clients.” Citi’s Robson, meanwhile, argues
for both carrot and stick. “There may have to be a lot of hand-holding in companies with a decentralised management structure,” he says.
“There will always be cultural issues, so it is important to have a strong policy that allows for no negotiation”
“You need to be very clear about the benefits to the organisation so you can win senior management buy-in, because without their backing it will be hard to roll out.” Robson recommends that clients work with the issuer on the roll-out by appointing a dedicated internal team that understands the nuances of corporate culture in each market. He also recommends rolling out in the largest markets first, so that their success stories can be communicated to other countries.
REGULATORY FRAMEWORKS In addition to differing cultural issues, every country has a unique, complex regulatory framework surrounding corporate payments. Wading in without expert knowledge
is not to be recommended. Issuers will, of course, assist, but, says Mastercard’s Rene Stynen, it is also important to consult the internal legal department and possibly specialist external lawyers as well. Many other decisions will need
to be made along the way – for example, whether to choose a card in each market issued in the local currency (answer: yes, generally, because it is more convenient for the local workforce, but there may be exceptions). However, formidable as these challenges undoubtedly are, the growing familiarity of cards in emerging markets and widening range of issuers mean global expansion of the corporate payment programme is an issue which should no longer be ignored. n
Pay. Airplus has until recently been the only Western company with permission to operate a lodge card. The reason is that Airplus operates on the airline-owned UATP (Universal Air Travel Plan) network, which China’s regulatory authorities deem a billing system as opposed to a payment network like Amex, Visa or Mastercard. However, China has started to
soften its position and both Amex (which is a ‘closed-loop’ provider, meaning it is an issuer as well as a payment network) and Citi have
30 • Buying Business Travel 2013
obtained licences in recent months to start issuing in renminbi, the national Chinese currency. For example, Citi announced its first sole-branded cards for China in September 2012, issued through Visa and Mastercard as well as Union Pay. Yet even when Western-style payment products become more widely available, that will only be half the battle won. Culturally and economically, China is still not entirely ready for corporate cards. According to Gillies, corporate
payments are more usually made by bank drafts, telegraphic transfer, credit vouchers or letters of credit. With relatively few Chinese business people possessing corporate or personal cards, suppliers typically invoice the traveller’s travel management company, which in turn re-invoices the client. Nor does it help, says Gall, that banks usually insist on credit checks of individuals before issuing a corporate card, even when the employer is liable in the event of a bill going unpaid. “Most employees
are insufficiently wealthy to have a card,” says Gall. In spite of these challenges, Gall and others insist interest is awakening in China as economic growth slows and companies start to understand the need to control their expenses in a more managed and transparent manner. Gall says Airplus is now getting its foot inside the door of China’s largest companies, and chairman Patrick Diemer even stated recently that China could become the number one market worldwide for Airplus.
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