Whether its called a Corporate Card, Travel Card or Purchase Card, do you personally want to be responsible for for the balance? It is reported that last year employees charged $140 billion to corporate credit card accounts. According to RPMG research, 35% of corporate cards have either individual or joint liability agreements with the card company. This means if your employer doesn’t pay the bill, you could be responsible for it. Your company might ask you to charge air fare, hotel rooms, supply purchases and more, but be careful because you could get stuck with the bill. This could especially be the case if your employer goes out of business or just simply can’t make the payments. Depending on the agreement your employer has with the card issuer, the card company might come after you for payment. Not only could this cause you to go into debt, but it could ruin your credit for years to come.
Take it from Charley Heiges who used to work for a company that manufactured duck hunting decoys. When the company went under, Heiges was expected to pick up the tab on his $10,000 company credit card. Heiges found out that his company did not pay its final bill when he was turned down for a loan. The reason was because of this outstanding debt that was accumulated on his corporate card.
What To Look For When Using A Corporate Card
- Check Your Credit Report
If your business credit card shows up on your credit report than you can be sure that you are responsible for the card. If the card is in good standing then it will help your credit score, but what if the card is not in good standing? It will negatively affect your credit score and you can be held liable for the charges. This is a sign that you can be held personally responsible for the card. - You Get Reimbursed for Card Payments
If you are required to make the payments and your company reimburses you then you could very well be liable for the card. If this is the arrangement you have with your employer then you should check to see what the agreement is with the card company. - Your Personal Information Was Used
If you have to apply for the card or your personal information was used in order for you to be able to use the corporate card this could be a sign you are responsible for the account. Just because the card has our name on it doesn’t necessarily mean you are liable, but if you had to fill out an application just like if you were applying for a personal card you should check into the agreement.
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