{"id":5649,"date":"2021-03-23T14:37:29","date_gmt":"2021-03-23T09:07:29","guid":{"rendered":"https:\/\/razorpay.com\/blog\/?p=5649"},"modified":"2026-01-02T17:35:59","modified_gmt":"2026-01-02T12:05:59","slug":"types-of-corporate-cards","status":"publish","type":"post","link":"https:\/\/razorpay.com\/blog\/business-banking\/types-of-corporate-cards\/","title":{"rendered":"Types of Corporate Cards Available for Small Businesses"},"content":{"rendered":"

Many small businesses struggle to secure a line of credit crucial to running their operations. This is a bottleneck that impacts their overall financial infrastructure. While many founders resort to using their personal credit cards, this can put their personal finances at risk. What is the solution? A corporate credit card!<\/span><\/p>\r\n

Like personal credit cards, corporate cards<\/a> are also issued by a financial institution. Compared to traditional loans, business credit card interest rates are slightly higher, as they offer a type of unsecured loan and hence, are riskier. However, some lenders do offer secured business credit cards that can come in handy, especially for businesses with little or no credit history. <\/span>There are various types of corporate cards available for small businesses. Want to know more about them? Scroll down!\u00a0<\/span><\/p>\r\n

Signup for corporate credit for your startup<\/a><\/p>\r\n

RazorpayX Corporate Card was launched in 2020 exclusively for consistent users of Razorpay and RazorpayX, where we tried to address the needs for growing businesses. It was developed in association with SBM India, one of the biggest banks in the APAC region. But, there are a lot of questions about what a Corporate Card really is. This blog aims to answer those questions by describing different kinds of Corporate Cards.<\/p>\r\n

Types of Corporate cards<\/b><\/h2>\r\n

1. Purchase Cards<\/b><\/h3>\r\n

Purchase Cards, also known as P-Cards, are generally used for operational expenses. They act as procurement tools that are used for B2B transactions and can be used to bypass the Purchase Order (PO) process for low-value items. Such cards are best used for purposes like buying office supplies, paying utility bills, or managing software subscriptions.<\/span><\/p>\r\n

Purchase cards offer control over spending and allow finance teams to set spending limits and restrict usage to specific merchant categories. They reduce administrative burden and make procurement of products or services easier for a business.\u00a0<\/span><\/p>\r\n

2. <\/span>Virtual Corporate Cards<\/b><\/h3>\r\n

With digital-native businesses on the rise, Virtual Cards have become the fastest-growing category in B2B payments. A virtual card is a randomly generated 16-digit card number, CVV, and expiry date, and does not exist physically. You can generate these cards instantly via an institution and can be linked to your main corporate credit line or wallet.<\/span><\/p>\r\n

These cards are often considered safer as they cannot be physically stolen. They are also easy to disable in case they get compromised. Virtual Corporate Cards are also easier to control as you can update your transaction limits as per your needs. The only drawback is that you cannot do any offline POS transactions with it.<\/span><\/p>\r\n

3. Travel & Entertainment Cards<\/strong><\/span><\/h3>\r\n

Travel & Entertainment (T&E) cards are corporate credit instruments designed to manage expenses related to business travel, dining, and entertainment. These cards are typically issued to employees who frequently travel for work, ensuring they do not have to use personal funds for flights, accommodation, or meals.<\/span><\/p>\r\n

These cards often come with travel-centric perks such as complimentary airport lounge access and travel insurance. T&E cards are beneficial for both employees and employers as they streamline the reimbursement process by consolidating all travel-related spending into a single statement.\u00a0<\/span><\/p>\r\n

4. Business Cards<\/strong><\/span><\/h3>\r\n

Business Cards are credit solutions primarily aimed at business owners and top-level management to handle general operational costs. These cards are designed to cover a wide range of day-to-day business needs, ensuring that the company\u2019s operational cash flow remains fluid without impacting the working capital.<\/span><\/p>\r\n

They are best utilized for recurring expenses such as utility payments, digital marketing ad spends, and monthly SaaS subscriptions. By using Business Cards, owners can separate their personal finances from business liabilities. These cards also offer exclusive discounts and interest-free credit periods.<\/span><\/p>\r\n

5. Prepaid cards<\/b><\/h3>\r\n

This is not exactly a credit card as one needs to load cash before using it. After loading cash, one can use this card until the balance becomes zero again. The great advantage of prepaid corporate cards is that they can be used at all places that accept credit cards.\u00a0<\/span><\/p>\r\n

It is a great way to easily pay for all the recurring and international expenses for a business and keep a track of team expenditure. However, keep in mind that not all prepaid cards<\/a> are the same. Gift cards, also called prepaid cards, once redeemed, can not be reused.<\/span><\/p>\r\n

6. Charge cards<\/b><\/h3>\r\n

These cards have stark differences when compared to revolving credit cards. One needs to settle all the outstanding balances at the end of each month. Again, there is no surcharge in case of timely payment. However, one might need to pay substantial fees if the payment is not cleared after the set period.\u00a0<\/span><\/p>\r\n

There is also an annual fee attached with the charge card. To get approval for a charge card, businesses must have a good to excellent credit score. Since there is a huge spending limit that comes with charge cards, businesses can leverage it for large purchases. Charge cards also typically have a very generous rewarding mechanism for the cardholders.<\/span><\/p>\r\n

Comparing Different Types of Corporate Cards<\/span><\/h2>\r\n

Here is a brief difference between different types of corporate credit cards based on their features.<\/span><\/p>\r\n\r\n\r\n\r\n\r\n\r\n\r\n\r\n\r\n
\r\n

Feature<\/b><\/p>\r\n<\/td>\r\n

\r\n

Business Card<\/b><\/p>\r\n<\/td>\r\n

\r\n

T&E Card<\/b><\/p>\r\n<\/td>\r\n

\r\n

Purchase Card\u00a0<\/b><\/p>\r\n<\/td>\r\n

\r\n

Prepaid Card<\/b><\/p>\r\n<\/td>\r\n

\r\n

Charge Card<\/b><\/p>\r\n<\/td>\r\n

\r\n

Virtual Card<\/b><\/p>\r\n<\/td>\r\n<\/tr>\r\n

\r\n

Credit Facility<\/b><\/p>\r\n<\/td>\r\n

\r\n

Yes (Revolving)<\/span><\/p>\r\n<\/td>\r\n

\r\n

Yes (Revolving)<\/span><\/p>\r\n<\/td>\r\n

\r\n

Yes (Revolving\/Controlled)<\/span><\/p>\r\n<\/td>\r\n

\r\n

No (Pre-load)<\/span><\/p>\r\n<\/td>\r\n

\r\n

Yes (Pay in full)<\/span><\/p>\r\n<\/td>\r\n

\r\n

Linked to the parent limit<\/span><\/p>\r\n<\/td>\r\n<\/tr>\r\n

\r\n

Interest-Free Period<\/b><\/p>\r\n<\/td>\r\n

\r\n

30\u201345 Days<\/span><\/p>\r\n<\/td>\r\n

\r\n

30\u201345 Days<\/span><\/p>\r\n<\/td>\r\n

\r\n

30\u201345 Days<\/span><\/p>\r\n<\/td>\r\n

\r\n

N\/A<\/span><\/p>\r\n<\/td>\r\n

\r\n

~30 Days (Until due)<\/span><\/p>\r\n<\/td>\r\n

\r\n

Same as the parent card<\/span><\/p>\r\n<\/td>\r\n<\/tr>\r\n

\r\n

Primary Use Case<\/b><\/p>\r\n<\/td>\r\n

\r\n

Operations, Utilities & Ads<\/span><\/p>\r\n<\/td>\r\n

\r\n

Travel, Dining & Hotels<\/span><\/p>\r\n<\/td>\r\n

\r\n

Procurement & Supplies<\/span><\/p>\r\n<\/td>\r\n

\r\n

Team Allowance \/ One-time<\/span><\/p>\r\n<\/td>\r\n

\r\n

Large Purchases<\/span><\/p>\r\n<\/td>\r\n

\r\n

SaaS & Online Payments<\/span><\/p>\r\n<\/td>\r\n<\/tr>\r\n

\r\n

Best For<\/b><\/p>\r\n<\/td>\r\n

\r\n

Business Owners & Ops<\/span><\/p>\r\n<\/td>\r\n

\r\n

Frequent Travelers<\/span><\/p>\r\n<\/td>\r\n

\r\n

Bypassing the PO process<\/span><\/p>\r\n<\/td>\r\n

\r\n

Controlling team spends<\/span><\/p>\r\n<\/td>\r\n

\r\n

Maximizing Rewards<\/span><\/p>\r\n<\/td>\r\n

\r\n

Security & Subscriptions<\/span><\/p>\r\n<\/td>\r\n<\/tr>\r\n

\r\n

Eligibility<\/b><\/p>\r\n<\/td>\r\n

\r\n

Revenue & Biz Vintage<\/span><\/p>\r\n<\/td>\r\n

\r\n

Employees\/Sales Teams<\/span><\/p>\r\n<\/td>\r\n

\r\n

Established Business<\/span><\/p>\r\n<\/td>\r\n

\r\n

Any (No credit check)<\/span><\/p>\r\n<\/td>\r\n

\r\n

Excellent Credit Score<\/span><\/p>\r\n<\/td>\r\n

\r\n

Existing Account Holder<\/span><\/p>\r\n<\/td>\r\n<\/tr>\r\n<\/tbody>\r\n<\/table>\r\n

Difference Between Business Cards and Purchase Cards\u00a0<\/b><\/h2>\r\n

It is common to confuse purchase cards with business cards. Here are the major differences between the two, tabulated below.<\/span><\/p>\r\n\r\n\r\n\r\n\r\n\r\n\r\n\r\n\r\n\r\n
\r\n

Feature<\/b><\/p>\r\n<\/td>\r\n

\r\n

Purchase Cards<\/b><\/p>\r\n<\/td>\r\n

\r\n

Business Cards\u00a0<\/b><\/p>\r\n<\/td>\r\n<\/tr>\r\n

\r\n

Liability<\/b><\/p>\r\n<\/td>\r\n

\r\n

Company Liability; debt belongs to the business entity<\/span><\/p>\r\n<\/td>\r\n

\r\n

Owner Liability; a personal guarantee is required from the owner<\/span><\/p>\r\n<\/td>\r\n<\/tr>\r\n

\r\n

Primary Target<\/b><\/p>\r\n<\/td>\r\n

\r\n

Finance & Admin Teams<\/span><\/p>\r\n<\/td>\r\n

\r\n

Business Owners & Founders<\/span><\/p>\r\n<\/td>\r\n<\/tr>\r\n

\r\n

Primary Goal<\/b><\/p>\r\n<\/td>\r\n

\r\n

Bypassing PO Process<\/span><\/p>\r\n<\/td>\r\n

\r\n

Separating Expenses<\/span><\/p>\r\n<\/td>\r\n<\/tr>\r\n

\r\n

Spend Category<\/b><\/p>\r\n<\/td>\r\n

\r\n

Procurement & Supplies, such as Office supplies, vendor payments<\/span><\/p>\r\n<\/td>\r\n

\r\n

General Operations, such as Digital Ads, Utilities, SaaS subscriptions<\/span><\/p>\r\n<\/td>\r\n<\/tr>\r\n

\r\n

Credit Assessment<\/b><\/p>\r\n<\/td>\r\n

\r\n

Based on Company Financials<\/span><\/p>\r\n<\/td>\r\n

\r\n

Based on Owner\u2019s Credit Profile<\/span><\/p>\r\n<\/td>\r\n<\/tr>\r\n

\r\n

Control Level<\/b><\/p>\r\n<\/td>\r\n

\r\n

High<\/span><\/p>\r\n<\/td>\r\n

\r\n

Standard<\/span><\/p>\r\n<\/td>\r\n<\/tr>\r\n<\/tbody>\r\n<\/table>\r\n

 <\/p>\r\n

There are various types of credit cards that are suitable for different kinds of business needs. To pick the most suitable one for your business, you should assess each of them on various parameters like benefits, flexibility, rate of interest, credit portfolio, and more. Carefully consider these criteria in advance while picking a business credit card so that it supports the growth of your business instead of hurting your creditworthiness.\u00a0<\/span><\/p>\r\n

How to Choose the Right Corporate Card for Your Small Business?<\/span><\/h2>\r\n

There are various types of credit cards that are suitable for different kinds of business needs. To pick the most suitable one for your business, you should assess each of them on various parameters like <\/span>liability structure, collateral requirements (secured vs. unsecured), expense control features, forex markup fees, reward benefits, and more. <\/span>Carefully consider these criteria in advance while picking a business credit card so that it supports the growth of your business instead of hurting your creditworthiness. <\/span>Here are some factors to consider before finally settling down on a choice –<\/span><\/p>\r\n