Cos can save travel, entertainment spend with corporate cards

Corporates can save up to 12 per cent in their travel and entertainment expenses by replacing expensive form of fund transfer such as cash and electronic transfers with corporate cards and also through better expense management, says a report.
According to a report by global payments technology Visa and Deloitte Consulting, less than one in five domestic businesses or 18 per cent are using corporate cards to manage their travel and entertainment expenses.
The findings reveal that only 13 per cent of companies have a fully-automated reporting process to monitor spending.
"Domestic corporations could save up to 11.6 per cent in their travel and entertainment (T&E) expenses by doing away with less efficient and more expensive forms of payment such as cash and electronic funds transfer, and from better automation of T&E processes," the report said.

Apart from efficiencies, corporate cards provide added convenience of managing T&E expenditure, and also greater transparency to ensure compliance, enabling real time audits to identify potential out-of-policy spends.
The study was based on an online survey wherein a total of 77 corporates participated and was conducted in the first quarter of 2013. It showed that airfares and accommodation accounts for 82 per cent of all T&E expenditure. It said that all the travelling employees take 21 local trips and five international trips annually.

The report said nearly 25 per cent of corporates cited policy framework for controlled corporate card usage and 20 per cent attributed the limited usage of cards, to global policies.

It said although over 94 per cent of organisations have put in place detailed T&E policies and have invested in enterprise resource planning systems (83 per cent) to automate back office functions, only less than a third (32 per cent) of those corporations are using ERP systems for T&E processes.
While policies for corporate card usage exist for nearly 61 per cent respondents; only 16 per cent of respondents indicated the existence of a comprehensive policy framework for usage of corporate and prepaid cards, the findings showed.
Commenting on the report, Visa India head Uttam Nayak said, "While local companies are beginning to understand the benefits of easy-to-implement systems, MNCs based in the country are the ones paving the way forward by adopting and implementing T&E expense management solutions."

The findings showed that the firms with corporate cards process nearly 53 per cent of all reports automatically, while nearly 47 percent of reports still go through manual process of submission, review and approval.
About 44 per cent companies have a manual reporting system and 43 per cent have upgraded to partially automated T&E reporting, the report said.