What are expense reimbursements?
Expense reimbursements are refunds you give to your team when they’ve used their personal money on business-related expenses. Common types of expense reimbursements include:
• Travel and Mileage
• Meals and Entertainment
• Office Expense
• Education Expenses
4 ways expense reimbursements may be hurting your business
1. Decreased employee satisfaction
When your team are forced to use personal funds for company expenses this can impact their own personal cash flow (in fact research show that 2 in 5 employees have experienced this, and 38% of employees have felt stressed by inefficient reimbursement processes!) 
2. Manual data entry
It may surprise you how many hours a week or month your processing team (and maybe that’s you!) is spending manually entering data and chasing receipts to complete expense reimbursements. This can easily prevent your team from progressing on to higher-value tasks and can also create unwelcome delays in closing off your books.
3. Lack of visibility
Your business expense reimbursements are only recorded once the reimbursement claim has processed. This can leave you with a lack of visibility over employee spending. Sadly, it would seem that up to 35% of SME’s may have little to no clear view of their employee expenses . As a result, businesses are more likely to mismanage budgets and overspend.
4. Potential fraud
Did you know that expense reimbursement fraud makes up 21% of fraud cases for small businesses? . This can put your company funds at risk and create the need for additional control processes.
Is there an alternative?
Yes, there is! Instead of reimbursing staff members for out of pocket expenses, why not consider the following solution with DiviPay:
1. Issue DiviPay cards to your team
DiviPay virtual cards allow your team to pay for what they need without using their personal money. Not only that, but you can track spending as it happens and eliminate the need for a reimbursement process altogether.
2. Create an expense policy
Give each of your team clear guidelines on what they can and can’t spend money on and keep expenditure in check with a regular review. A clear policy helps everyone!
3. Use DiviPay “smarts” to manage budgets, spending and reporting
DiviPay will help your team:
- Easily pay for business expenses
- Upload the receipt
- Add important details of the purchase
- Be aware of, and stay within, an allocated budget
And it doesn’t end there, DiviPay can then integrate this information directly into your Xero file, as well as giving you a birds-eye view of all employee expenses in a single platform. So handy.
Check out all the latest on Divipay at divipay.com
- https://confermapay.com/wp-content/uploads/2020/02/CP-Invisible-Bank-US-1.pdf (Accessed Nov 2020)
- https://cdn2.hubspot.net/hubfs/3906991/Paystream%202018%20Travel%20and%20Expense%20Management%20report.pdf (Accessed Nov 2020)