Man using credit card

3 min read

Key takeaways

  • Purchasing credit cards are designed to make the purchasing process easier for organizations by replacing manual, paper-based purchasing orders and check payments, which are usually time-intensive.
  • Purchasing cards can help enhance organizations’ purchasing oversight, reduce costs and improve days payable outstanding (DPO).
  • Before implementing a purchasing card program, businesses should examine their needs and capabilities as well as the program’s potential financial impacts.

When employees use personal credit cards to make business-related purchases, their company lacks control over spending, misses out on potential rebate earnings and requires added time and resources to process the expenses. That’s where purchasing cards come in.

What is a purchasing card?

Sometimes referred to as procurement cards, procards or p-cards, purchasing cards are a type of corporate credit card designed to make the purchasing process easier for companies. These cards can help reduce inefficiencies in traditional purchase processes. P-cards can be used to purchase a variety of items and services, including:

  • Office supplies, such as technology, stationery, etc.
  • Training and professional development courses and materials
  • Business services such as legal, consulting and cleaning 
  • Advertising expenses
  • Client meetings, events, hospitality and gifts 
  • Fleet management, gas and parts
  • Shipping, postage and packaging supplies


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Find out more about p-cards, how they work and the benefits they offer.

How purchasing cards work

Once extended a line of credit from an issuing financial institution, businesses distribute purchasing cards to their employees. The credit card program administrator then sets controls and policies for the purchasing card program. Employees issued a p-card can then make business-related purchases in line with their program’s policies. 

Under card programs with corporate liability, the business—rather than its owners or individual cardholders—are liable to repay the balance on the cards monthly.

The benefits of a purchasing card program

When implemented and managed effectively, purchasing cards can drive significant value for companies by helping them:

1. Control spending

Purchasing cards can help your organization track spending. For example, J.P. Morgan’s p-card program offers program-level and individual account controls so you can govern employee purchases across the organization.

2. Make purchases faster

Rather than bog down accounts payable teams with purchase orders or other manual, time-intensive processes, employees can make procurement card purchases with approval from their manager. With faster purchases, accounts payable teams have more time to work on more complex duties. And with access to real-time transaction data, managers and accounts payable teams can spot spending patterns, and cost-saving opportunities.

3. Improve vendor relationships

P-cards can be used to complete supplier payments more quickly, even as the company holds onto its cash longer. That could help maintain or improve a strong working relationship between companies and their suppliers. Consistently and promptly paying vendor invoices may even encourage vendors to provide perks.

4. Increase rebate revenue potential

Purchasing cards offer opportunities for companies to benefit from revenue share through rebates offered by the card program’s providing bank. Businesses can use rebates for various purposes, including offsetting the costs of digital tools and other operating expenses. 

5. Improve payables security

To help protect against fraud, procurement cards may include spend limits, PINs, cardholder verification and monitoring, and other security features designed to protect against fraudulent activity.

What to look for in a purchasing credit card

Many banks and financial institutions offer purchasing cards with varying features, benefits and cost structures. Before choosing a p-card, you should closely examine your organization’s purchasing needs and capabilities, plus the potential impact of a purchasing card program. You may also want to consider the most important card features for your business, including:

  • Spend limits: Study a card program’s ability to set clear limits on card spending by dollar amount and activity limits by transaction, day or billing cycle. 
  • Fraud protection: Most procurement card providers offer liability insurance for each eligible cardholder to protect against employee misuse. Likewise, p-card providers may also offer cardholder verification and monitoring to protect against fraud.
  • ERP integration: A purchasing card should easily integrate with your existing systems—most importantly, your enterprise resource planning system. 
  • Receipt imaging and expense approval: Understand a card program’s ability to properly track purchases, with proper documentation, including receipt imaging. Expense approval is also critical to maintaining oversight.

A purchasing card is one of several payment solutions available. Learn more about J.P. Morgan commercial credit card programs.

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