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What is a p-card?

P-card stands for procurement card or purchasing card. It is the physical payment mechanism used to transfer money from your business to suppliers and providers, such as when making a purchase order.

Traditionally, employees would use a personal credit card, before going through the lengthy reimbursement and approval process at work. But with a p-card program, the cardholder does not incur any personal costs and all transactions can be approved or denied using automation. Moreover, integration with accounting software means that the finance team can cut the time spent on paperwork, such as expense reports.

How does a procurement card work?

The typical procurement process using a p-card works like this:

  1. The finance team or department manager will set the p-card policy controls for individual employees with regards to their budgets.

  2. If a transaction amount is less than the designated spending limits, the p-card payment is automatically approved.

  3. If it exceeds the spending limit, the employee makes a request on the system, detailing their planned purchase and associated transaction costs. A notification is instantly sent to the manager, who can choose to approve, change, or deny the request.

  4. Upon approval, the amount is transferred to that employee automatically to spend on their intended purchase. This money cannot be spent elsewhere, preventing maverick spend.

  5. The employee then uploads their receipt to the app, enabling the finance team to begin the reconciling process and documentation around business expenses.

Types of purchasing cards

Purchasing cards offer flexibility. Within your purchasing card program, there are several different types of company cards:

Single use

Single-use cards are for one-off purchases and are well-suited to payments where security may be compromised.

These days, businesses frequently make small purchases online. But sharing your bank details over email, such as account number, is a major security risk for end-users.

Single-use cards enable information sharing without the anxiety that comes with divulging card details, because they are discarded after just one use. They make your p-card transactions secure, every time.

Virtual cards

Forget about plastic waste when you’re done with the single use cards. Virtual cards, as the name suggests, only exist online.

A card issuer usually makes virtual cards for the purpose of dedicated online subscription payments, such as for sales software and technology.

Purchases with virtual cards can be automatically set to reoccur, and are kept separate from other transactions in the payment process since virtual cards are usually created for one service, product, or supplier.


Finally, physical cards are available for in-store purchases. Their functionality is the same as any other charge card that you’d find in corporate purchasing.

Typically, these cards are loaded with a monthly budget and charged at a card reader POS, which enables three-factor authentication. Cards powered by Visa or Mastercard can be used in 99% of stores worldwide.

Purchasing card controls

One of the biggest benefits of using p-cards is their high level of control. They are a great way to manage budgets and get accurate spending information when it comes to forecasting the next month, quarter, or year.

You can simultaneously empower your employee with access to their own expenses card, while preventing maverick spending.

Here are some of the controls that come with a p-card:

  1. Approved vendor list: creating a list of authorized suppliers ensures that the card cannot be used elsewhere.

  2. ATM use: allow (or deny) each employee to withdraw cash from an ATM, alongside their card spending.

  3. Spending limit: set thresholds around spending caps over a day, week, or month.

  4. Manager approval: great for new employees who are still getting accustomed to the spending policy, purchases require instant managerial approval through the mobile app.

  5. Limited dates and times: unlock the card during certain times of the day or specified dates, such as when attending a conference.

  6. Online or in-store only: block internet purchases or in-person usage.

P-card vs credit card

There’s a huge problem with today’s notion of a company credit card. They make it incredibly hard to manage spending and are easily subject to fraud.

The purpose of company cards was never for spending though, it was to simplify the expense process. The logic makes sense: if the card is not in the employee’s name, they wouldn’t need to make expense claims. But is a clunky process, with a catch-22:

  • The company realizes that access to funds is a problem and rolls out corporate cards for every team member

  • It becomes too hard to manage and they pulls this back to only cards for key members of the team

Fortunately, this is where purchasing cards differ. With customizable spending rules, fears around out-of-control company spending disappear. Moreover, card details never need to be shared since everybody is assigned their own individual card. This significantly reduces security risk.

With individual corporate debit cards, employees are held accountable and every single transaction can be attributed to its purchaser. Through the Spendesk app, receipts can be uploaded instantly at the click of the button, making p-card use favorable for the finance function too.

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Last update: 2 February 2022