The business payment card sector continues to widen the gap with cash and cheques. At Visa Europe, the European payment system, the business card segment grew more last year than the consumer card segment. More specifically, the volume of payments made using business cards increased by 26.5 % across Europe. This is explained by the combined effect of the growing number of cards held by companies and the increase in expenditure channelled through them.<\/p>\n
In France, the main market players - American Express, Mastercard, Visa and Diners Club - are keeping a tight lid on the potential of the French market. They jealously guard their forward-looking studies, but do not publish them. Only a few recent figures are circulating. In 2006, for example, there were 1 million Visa business cards in France, out of a total of 7.3 million in Europe. Mastercard had around 500,000 cards in circulation in France. Even including American Express cards, not all of France's three million businesses had cards. Hence the market's significant growth potential. To exploit this potential, these players are targeting their offer according to the size of their customers: on the one hand, small businesses and the self-employed; on the other, medium-sized and large businesses. For each customer category, the range comprises three products: an entry-level product, a mid-range product and a top-of-the-range product. It is the level of service that makes the difference.<\/p>\n
Designed specifically to meet the needs of the self-employed and very small businesses, business cards offer specific services that go beyond payment and withdrawal functions. Starting with comprehensive insurance and assistance cover, covering both the person and the tools of the trade.<\/p>\n
In financial terms, they are charged directly to the company's account. A statement of expenditure distinguishes business expenses from personal expenses. Directly distributed cards, such as American Express, or those issued by banks, such as Visa and Mastercard, generally give access to negotiated rates from car hire companies, hotels or service providers responsible for recovering VAT on expenses incurred abroad. This is a real advantage for small companies that don't have the clout to negotiate on their own.<\/p>\n
In the other segment of the market, i.e. large and medium-sized companies, issuers offer business cards, otherwise known as corporate cards. Depending on the size of the company, a more or less extensive invitation to tender is drawn up by those responsible for travel management, who may call on a consultant to bring the project to a successful conclusion. \"For the candidates in the running, the stakes are different depending on whether the annual travel budget is in the region of \u20ac500,000 or in excess of \u20ac10 million\", says Anne-Laure Gogeon, consultant at Espa. That said, when a group launches a call for tenders to set up or even renew its fleet of corporate cards, the price of the card is the main factor.<\/p>\n
Everything will therefore be negotiated on the basis of the total level of transactions passing through the cards: on the one hand, the total number of cards issued and, on the other, the average volume of expenditure made by each cardholder. \"Negotiation will be all the easier if the majority of travel is abroad, which allows the card issuer to charge exchange fees. For companies involved in this type of travel, a detailed study of the exchange rates applied by the bank will be necessary to make the right choice\", adds Anne-Laure Gogeon.<\/p>\n
Another selection criterion is the deferment period, which can be between 30 and 60 days, and even 90 days in some cases. Other factors are also taken into account, but to a lesser extent. These include services such as insurance, travel assistance, the availability of traveller's cheques or cash, and the operator's ability to offer different levels of card.<\/p>\n
As you can imagine, the call for tenders gives rise to bitter negotiations. The stakes are high: the aim is to retain or win a \"major account\" that will generate substantial travel budgets on which the operator will earn commission. In order to win the tender, managers therefore emphasise the importance of their acceptance network, their financial terms and conditions, the quality of their reporting and the extent of their additional guarantees. After all, they have a certain amount of room for manoeuvre.<\/p>\n
In addition to the guarantees that are systematically included, the banking networks can configure all or part of the optional insurance or assistance guarantees, possibly granting an individual \"travel accident\" insurance extension, with a doubling of the capital paid to the beneficiary. Bankers can adjust the cover in the event of delays in transport or luggage, or fraudulent use of the card, etc. When it comes to assistance abroad, banks can increase the amount of cover for medical expenses. This is important for a company whose employees often travel to the United States, where medical costs are particularly high.<\/p>\n
Business cards are commonly used by employees to pay business expenses when travelling, and are linked to an account opened in the company's name or to an account in the cardholder's name. In the latter case, the cardholder is generally reimbursed by the company before the expenses are debited to his or her own bank account.<\/p>\n
When it comes to deploying maps, there are three main strategies. Firstly, there may be several card managers for voluntary or historical reasons. For example, a group may use two different networks depending on the category of employees. Frequent travellers will deal with American Express, which distributes its frequent flyer cards directly, while employees with monthly expenses of at least 150 euros will use Visa cards. A single network is then responsible for managing the entire card portfolio, selecting card categories according to the traveller's profile. For example, it grants the Visa Gold to the Chairman, Vice-Chairmen and Sales Directors, and reserves the simple Visa Business for sales and technical staff. Lastly, the travel and relocation department aims for uniformity and allocates Visa Business cards to everyone, from members of the executive committee to sales and marketing staff. \"Anne-Laure Gogeon explains: \"To simplify the management of the card pool and increase negotiating power, particularly on cards that generate a lower volume of expenditure, it's best to choose a single point of contact to set up the card supplier.<\/p>\n
Whatever the card allocation policy within a group, the recommendations are strict: no cash advances may be made through the company. However, travellers are authorised to withdraw cash from an ATM using individually-billed corporate cards. Permanent advances are only granted when security, remoteness or low salary levels make this a necessity. Depending on their needs, the groups define the payment ceilings per employee, and whether or not cardholders can withdraw cash. The fact that responsibility is shared between the cardholder and their employer prevents excesses. Even so, employees may use the card for personal purposes, but these cases are fairly rare. And if they do, they pay for it.<\/p>\n
Card managers such as American Express and Visa and Mastercard issuers are taking advantage of the growth of the Internet to transmit a flood of information to their customers. Depending on the banking network distributing the Visa card, this information is more or less complete and the frequency of its distribution more or less frequent. For example, BNP Paribas, which distributes the Visa card, has launched a new version of its website www.cartesentreprises. bnpparibas.com. \"This site has two secure areas: one for cardholders, the other for companies. Dedicated to card managers or travel managers, the latter area comprises three modules: transaction monitoring, card fleet monitoring and fleet management tools\", explains Ga\u00eblle La Corte, business card product manager in the BNP Paribas marketing department. The manager accesses this area using a login and password. When they log on, they can view details of each employee's transactions since the last monthly statement. They also have access to the history of transactions over the last six months and to summary statements. These statements show the transactions carried out in France and abroad, by employee and by category of expenditure: transport, hotels, car hire, with, in this case, a twelve-month history.<\/p>\n
The consolidation of travel programmes at European, and even global, level is also giving ideas to the major players in business travel. Last autumn, MasterCard Worldwide and Carlson Wagonlit Travel (CWT) launched an advanced travel data programme. Based on credit cards and aimed at purchasing professionals, this solution provides CWT customers paying with MasterCard credit cards with precise data on business expenses worldwide. The agreement is designed to encourage European and global groups to use a single card supplier.<\/p>\n
Available in France and a dozen European countries, this travel data programme is also available in Australia, China and Singapore. It should be noted that this global data can also be provided to customers dealing with American Express as a travel agency network. Through payment card issuers, companies of all sizes and public authorities can access more comprehensive data on their travel programme. They can then analyse this data and act accordingly. By integrating information about their travel programme, including travel policy, itineraries and accounting codes, companies 'equipped' with credit cards can make savings on business travel.<\/p>\n
There are two major players in the corporate card market - American Express and Mastercard - as well as Airplus, another specialist in online payment and reporting solutions for business travel management.<\/p>\n
The name of this service may change from one manager to another. Air Plus targets large companies, generally multinationals, through the BNP Paribas AirPlus card, or public institutions through the Travel Purchase Account. American Express calls this system of centralised billing via a card housed in a travel agency a \"business travel card account\". But when Soci\u00e9t\u00e9 G\u00e9n\u00e9rale issues Mastercard cards, it offers key accounts \"a combined business card-lodged card offer\".<\/p>\n
Payment cards generally have only two options: immediate debit and deferred debit. At Soci\u00e9t\u00e9 G\u00e9n\u00e9rale, there is a third option: selective debit, which allows you to use the same card number for all travel expenses: air, train, restaurant, taxi, hotel, etc. This solution therefore simplifies procedures. This solution simplifies procedures to a certain extent. It also means that large-value transactions - usually air travel - can be separated for billing purposes. More specifically, transactions relating to air travel are diverted to a company account. Another advantage, this time in terms of reporting, is that there is no need to reconcile card transactions and 'logged' transactions to draw up statistics for each employee.<\/p>\n
In terms of control and compliance with the travel policy, the result is the same whether the approach is based on a corporate card or an employee card. \"For ticket reservations, the company can impose the use of a travel agency network, which becomes the guarantor of compliance with the travel policy. Instead of using a corporate card, the travel agency simply uses the employee's corporate card number, which can be found in their traveller profile\", adds St\u00e9phane Thiry.<\/p>\n
In addition to reporting, the issuer of an embedded card or a corporate card with selective debit can provide other business travel expense management services. \"We offer our corporate customers online tracking of transactions, as well as the ability to modify and print out expense reports. This service provides them with a certain amount of accounting information on payment and withdrawal transactions on their fleet of business cards\", explains St\u00e9phanie Boedec, business card product manager at Soci\u00e9t\u00e9 G\u00e9n\u00e9rale. To access the service, you need to take out a subscription to Sogecarte.net.<\/p>\n
According to a recent Airplus study, four-fifths of purchasing managers analyse their data. The added value of reporting tools lies above all in the transparency they provide on all the company's travel expenditure. In the face of fierce competition, players in the field of business travel expense management are constantly fine-tuning their offerings. It is impossible to be exhaustive in this area. Take Mastercard, for example, which consolidates financial data with detailed travel data using information provided by global travel reservation systems (GSD) and certain travel agencies. This reporting includes the places of departure and arrival, the class of ticket and company-specific information such as department, cost centre, project and employee numbers. This data can be consulted using the Smart Data On line (SDOL) reporting tool, which also contains an integrated expense report management module offering different hierarchical levels of control. It is also possible to integrate enriched travel expenses and data into an accounting management system, both automatically and customised.<\/p>\n
As all card expenses - corporate, accommodation, purchasing, fleet, meeting - can also be integrated into SDOL, companies have complete visibility of their expenses: those linked to travel, those of an IT purchasing department, various services, consultants, conferences, or even those linked to fleet management, petrol, repairs, etc.,\" comments Stephane Thiry, Head of Corporate Solutions at Mastercard. As for the single global database for centralising expenses and enriched data, it also provides online visibility of travel expenses for multinational companies too.\"<\/p>\n
Furthermore, the cost of a business trip does not just include the price of the flight or the hotel. It also includes the hidden costs of the company's organisation and processes. \"Reducing the administrative costs of business travel represents a new source of savings for European companies\", states the latest study by American Express & A.T. Kerney. In addition to their business expenses, companies incur indirect management costs that represent an average of 4.6 %, or the equivalent of 323 euros per traveller per year. However, in the case of \"bad performers\", these costs can be as high as 34 %. At this stage, the introduction of corporate cards can reduce the bill. Overall, indirect costs continue to fall. From an average of 8 % in 1997, they fell to 5.6 % in 2003.<\/p>\n
Processing expense claims and preparing trips are time-consuming processes that also mobilise physical resources. \"Adopting better expense management practices could reduce indirect costs from 4.6 % to 2.1 %. This equates to a saving of 25 % for every thousand euros spent, or a reduction of 54 % in indirect costs,\" explains Marc Clatot, Vice President Corporate Services at American Express.<\/p>\n
Furthermore, since 1 October 2007, the marketing of co-branded bankcards has been authorised by the economic interest grouping (EIG) Cartes Bancaires. This type of card is therefore a new means of payment in France. Cobranding\", a term used in English-speaking countries, means that bankcards carry a non-bank brand in addition to the logo of the issuing credit institution, as part of a commercial partnership. So much for theory. In practice, the French leader in the bankcard market, Carte Bleue, continues to work with banks to help them build their electronic payment offering. But almost a year on from this regulatory change, the impact on the corporate card market in France remains limited.<\/p>\n
The sector is essentially made up of immediate or deferred debit cards. And not credit cards, which are predominant in Anglo-Saxon countries. \"Because of its business model, the debit card is less conducive to the development of co-branding\", notes David Cartier, head of marketing for high-end and corporate cards at Carte Bleue Visa.<\/p>\n
Unlike a credit card, a debit card does not come with a surcharge to finance, among other things, the benefits offered by the partner as part of a co-branded card. \"In the United States, Visa cards are co-branded with Mariott, United Airlines and Michelin. In the business travel sector in the UK, co-branding agreements have been signed with airlines such as Lufthansa and American Airlines, and hotel chains such as the Intercontinental group, which includes establishments such as Crowne Plaza, Holiday Inn and Intercontinental\", adds David Cartier.<\/p>\n
In France, around ten agreements have been launched or are in the process of being launched. But they rarely involve business travel. That's a shame.<\/p>","protected":false},"excerpt":{"rendered":"
The business payment card sector continues to widen the gap with cash and cheques. At Visa Europe, the European payment system, the business card segment grew more last year than the consumer card segment. More specifically, the volume of payments made using business cards increased [...].<\/p>","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[79],"tags":[1099],"type-darticle":[],"n_magazine":[],"class_list":["post-8623","post","type-post","status-publish","format-standard","hentry","category-outils-de-gestion","tag-cartes-affaires","vapo-free"],"acf":[],"yoast_head":"\n