Key controls to optimize commercial cards for the year ahead

As your venture-funded company focuses on year-end planning, did you know it’s also an ideal time to optimize your commercial card program? Along with budgeting and forecasting for the year ahead, updating core controls in your card program can unlock cost savings and operational efficiencies.

For example, year-end card program optimization should include fine-tuning your cardholder base, spending limits and expense policies. This systematic approach can better position your company to achieve growth milestones, while demonstrating the financial discipline investors and board members expect.

Optimize your commercial card program with role-based cards

In fast growing companies, commercial cards may get distributed based on convenience or status, overlooking some employees who have a business need. But as you scale up and finances get more complex, we recommend taking a more strategic approach to cardholders. You want to ensure the right employees have cards customized to support their job functions, while reducing risk and unnecessary spend.

First, assess your cardholder base and their current responsibilities. Then, revisit your criteria for who should have corporate cards. Does it still make sense for certain people to have cards? Are there gaps where newer team leads don’t have cards but should?

Consider role-based card distribution that’s tied to specific purchasing needs. It can give you tighter control to reduce admin overhead, while enabling the appropriate people to meet needs more efficiently.

Implement tiered spending limits that align with growth

Many companies initially distribute commercial cards in plastic with one-size-fits-all limits. As the business matures, it’s usually more effective to transition to customized virtual cards. Along with reducing fraud risk, virtual cards make it easy to tailor spending controls and limits to evolving organizational needs. It also gives your finance team critical real-time visibility over spend.

How should you re-evaluate card limits? Start by leveraging card spend data to analyze spending patterns, and compare that against current card limits. Then consider implementing strategies such as:

• Tiered spending limits based on department and role. Customize budgets, timelines, approvals and more across product development, marketing, sales and other teams.
• Temporary limit increases. Modify cards periodically to support project-based needs or seasonal trends like fall conference season.
• Category-specific restrictions. Optimize commercial cards by limiting allowable spend categories based on roles or use cases. For instance, auto-enforce limits on how business travelers can use their company card.

Refresh card spending policies

Do your expense policies accurately reflect how your business has grown? It may be time to replace the loose controls of early days with more formalized policies. At the same time, it’s important to ensure employees have clear guidance about allowed business expenses. If your commercial card program integrates with AI-powered spend management (like at SVB), you can customize spending policies and auto-enforce them as people use their cards.

As we speak with clients, we like to share 3 tips:

1. Fine-tune spend policies to align with current business operations and market conditions.
2. Avoid out-of-policy spend by providing documented guidelines and automated alerts for card usage.
3. Enable faster, more complete reporting by implementing automated mobile submissions for expense details and receipts. 

Year-end finance is more than just closing books and Q1 budgets. It’s a strategic time for corporate card audits to ensure spending policies and limits can best support next year’s growth goals. Gain the robust capabilities you need with SVB commercial cards.

Frequently asked questions

Who should have corporate cards in a growing company?

In fast-growth venture-funded companies, it’s often most effective to issue corporate cards based on role requirements and spending frequency. For example, provide cards to department heads and office managers who regularly handle procurement, and people who travel often for sales meetings or speaking engagements. Review cardholders once or twice a year to optimize commercial cards to best support a rapidly evolving business.

What's the best way to set commercial card limits?

Make sure your card program integrates with a spend management platform that enables maximum flexibility to customize card limits. Then, assess cardholder spending needs by role, and use payment data to identify spending patterns. A data-driven approach helps you create tiered limits (card budgets, spend categories, timeframes, etc.) appropriate to the volume and frequency of spend for various users. To optimize cash flow, high-growth companies should review cards quarterly and adjust limits up or down as needed.

How do we update corporate card policies for a scaling business?

Update corporate card policies by analyzing spending patterns, most used expense categories, and exceptions over the past 12-18 months. These insights help you decide how to refresh existing policies and add new ones, such as pre-approval thresholds, acceptable merchant categories and approved vendors, and when receipts are required. Factor in common scenarios like remote work expenses, SaaS subscriptions, client entertainment and business travel expenses. Give employees clear, documented guidelines and leverage your spend management platform to auto-enforce policies as card activity occurs.

How can we prevent employees from making unauthorized purchases with company cards?

Ensure in-policy purchases by consolidating spend on a single corporate card program. Then through your expense management platform, issue virtual cards with custom controls and policy alerts that restrict cardholders as needed. It gives your finance team real-time visibility over every transaction, automates policy compliance, and reduces the need for out-of-pocket reimbursements.

What controls should we implement for role-based corporate cards?

Implement role-based cards based on your latest criteria for who should have company cards. Then customize card limits (budget, expense codes, categories, timeframe) and spend policies based on a cardholder’s current responsibilities and specific purchasing needs. It gives your finance team tighter control to reduce admin overhead, while enabling the appropriate people to meet business needs efficiently.