By Daniel Hunter
Research by Caxton FX found that there are around 1.3m small to medium sized enterprises (SMEs) in the UK conducting business overseas and if you added up the money being wasted on using traditional corporate cards abroad, a £1bn black hole would be discovered.
Caxton FX also discovered that if businesses issued their employees with a prepaid currency card for their overseas trips, they could save more than £700 per year.
“Every time you use a traditional corporate business payment card, you will incur a charge whether it’s paying your hotel bill or visiting an ATM," Rupert Lee-Browne, CEO of Caxton FX, said:.
“The economic situation is particularly tough at the moment, especially for SMEs, and any savings that can be made should be welcome by businesses of any size.”
Caxton FX compared its own Euro and US Dollar business traveller currency cards against 10 leading competitors and found that, on average, they outperformed their competitors’ products by £764.15 per year.
Savings were made on the rates offered for payments in euros or US dollars, annual fees for issuing the card and withdrawing money whilst abroad.
American Express’ Platinum card was the worst culprit, charging its clients 2.99% per transaction, an annual fee of £300 per card, as well as a £3 fee every time someone went to withdraw cash from an ATM. In comparison, using a Caxton FX business traveller card would save a business £2,981.25 per year.
Lloyds offers corporate debit cards and they fared better, with businesses losing out on £166.95 compared to using a prepaid corporate card as there was no cost for issuing the card, as well as offering the more competitive rate of 2.75%.
However, corporate debit cards will draw funds direct from their business and that means expense money is not as easily controlled.
“Simply put, prepaid currency cards are the smart way for business travellers to pay for expenses and not only will businesses save on foreign exchange fees but they are a great way for financial directors to actually control spend when employees travel abroad," Rupert Lee-Browne said.
“Prepaid currency cards also offer security and convenience as business travellers won’t need to carry as much cash around and can be used the world over wherever you see the Visa or MasterCard signs.”
Join us on