It’s no surprise that large corporations frequently carry out different expenses to fulfill their business needs. More often than not, employees fund nominal expenses, such as flight tickets for a business trip or lunch for a client, from their own pockets. In such instances, the company needs to pay the employee back for their expenses on behalf of the company. It is often termed employee reimbursement.
Most people would agree that settling the reimbursement of expenses is a time-consuming and brain wrecking task for financial managers and employees. Refund traditionally follows three key steps:
- The employee requests a reimbursement.
- The company verifies the claim.
- Financial managers pay the employee if the claim is verified.
The latency between these steps is directly proportional to the likelihood of your employees building ill feelings about your financial management systems. Therefore, settling claims of reimbursements timely to prevent employees’ dissatisfaction with your business system is crucial. Technology is there to help you. Below are two ways to speed up the expense reimbursement process to save both your and your employee’s time and mental-wellbeing.
- Upgrade to corporate cards: If you don’t know what corporate cards mean, here’s an explanation: corporate cards are payment cards that employers issue to their employees to allow them to make payments from the company’s bank account. Undoubtedly, the best way to avoid settling reimbursements is by eliminating the need to file a refund.
Corporate cards are an excellent substitute for employees to carry around if they want to make business-related purchases. Corporate cards allow employees to make payments straight from your company’s account. Additionally, you can set up expense limits on your corporate cards to prevent your employees from overspending. You also get to decide which expenses are allowed and which are not.
The most significant benefit of corporate cards is that they let business managers keep track of all payments from one dashboard. Corporate cards are incredibly safe, as fraud can be easily captured and traced. Since corporate cards behave the same way as personal cards, purchases made through corporate cards may be eligible for rewards or cash back which can help a company save a lot of money.
- Invest in an electronic reimbursement management system: If putting money behind corporate cards doesn’t sound like the best strategy for your business, electronic reimbursement management must be the right fit. It works similarly to traditional expense reimbursement management but without excessive paperwork and repetitive data entry.
Businesses can integrate automated systems into their accounting software, allowing financial managers to keep an electronic track of all reimbursement claims. Requests can be approved or rejected in just a few clicks. Many expense reimbursement management services exist online that your company can invest in to have a more streamlined procedure for managing reimbursements. Some providers even provide the feature of categorizing the types of reimbursement claims, so it’s easier for financial managers to approve or reject requests in bulk.
The only other thing you would require for setting up an automated system is a clear set of rules that dictate how an employee requests a reimbursement and how claims are verified. It’s your responsibility that your employees understand the policies that the company has set to approve different requests. You can start by explaining what expenses qualify for reimbursement and which don’t. With an electronic system, employees can digitally request a refund and provide supporting evidence much more quickly.
Adapting digital solutions to settle reimbursements can be an intelligent strategy for your business as it will boost your employees’ productivity. It would eliminate the need for keeping a paper-based record of all expenses and will reimburse employees more quickly.