Business

An Overview of Co-Branded and Corporate Credit Cards

Apart from conventional credit cards, there are various other options too in terms of proprietary credit cards as corporate cards and co-branded cards, which allow retaining merchant credits in association with specific network processors.

These types of cards are getting branded with the network process and retailers. Unlike bank credit cards which are allocated to merchants, proprietary credit cards may be allocated to the purchase of various products.

Co-branded Credit Cards

Co-branded credit cards get branded with the logo of the network processor and the retailer. These types of cards can earn specific merchandise for their users and also get some amazing offers and discounts on selected products.

There are reward points also which can earn their users some discounts on the merchandise or letting them purchase with the sponsored merchants at special rates.

The co-branded credit cards play an important role in the retailers business also. These cards will allow retailers to issue limited-purpose or open-loop cards to the users. The card relationship with co-branded cards can be set up in various ways.

The card processing and setting co-branded relationships

For the release of any co-branded credit card, retailers or the vendors should establish a partnership with some financial institution at the first point. This institution will act as the acquiring bank of the retailer. This will further establish a transaction process for the credit card, and it will be based on the network processor of the acquiring bank.

In many cases, the retailers will opt to partner with renowned credit card providers. The network processors will display their logo on the cards along with the name of the retailer.

It is possible to associate with Discover or American Express to release the card relationships with their unique capacity to issue the credit cards and also to establish network processors. Other major providers of co-branded credit cards are MasterCard and Visa at a global scale.

In every transaction, merchants acquiring the bank work with the retail provider to process the electronic payment cards.

If there is any relationship established with an acquiring bank, then the transaction processing can be further simplified, especially in case of purchases in which the bank, as well as the retailer, will only be the two involved entities. If merchants work with third-party issuers to provide credit cards, then part form the above two, a co-branded credit card processor will also be included.

What are theBenefits of co-branded cards

The retailers of co-branded credit cards can associate with any random providers, and there are many possibilities in establishing co-branded credit card relationships. Issuance of retail credit will let the merchants also to offer some real benefits to the customers.

Retailers offer put forth many market discounts to the customers using the co-branded credit card and they also will let the customers gain some reward points which can be redeemed against future purchases.

While the customers apply for a specific merchant card, these can be something like single-purpose cards as store-specific cards or open-loop cards. The single purpose or store specific cards allow the users only to make use of it with a single merchant.

Such credit cards may also have limited credit and also offer the consumers some standard rewards also. These may not seem to be co-branded, but they may, however, follow the same transaction procedures of co-branded cards.

Firestone credit cards

Firestone credit cards are now issued as Credit First National Association Credit Card, which offers several unique benefits to the users. This corporate card is ideal for the fleet owners and also those who have a need for the frequent purchase of spare parts of vehicles. The major benefits of Firestone credit cards are:

  • The credit cards of Firestone are issued by the reputed Credit First National Association (CFNA)
  • The users get an APR of 21.84% on their retail purchases. However, the APR may increase to 24.84% over the 6 months time frame if the payment is not cleared within 5 days o the duet date.
  • The company offers a grace period of 25 days.
  • The interest is computed based on the average card balance per day with a minimum $1 charge for every day with a balance.
  • Staggered payment schedules on late payment, i.e., $15 for a balance below $100 and $25 for the balance from $100 to $299, and $33 for the balances of $300 plus.
  • About $29 as fee for bounce check
  • There is no specified over-the-limit fee.
  • There is no annual fee.
  • The provider will only collect information for selective share with the third parties and affiliates. The users also have the right to opt out also.

What Are The benefits of corporate credit cards

If used wisely, then corporate credit cards will effectively help one to meet their financial goals and reap some good personal perks too. However, on using these poorly, it may ultimately lead to the freefall of a corporate. Corporate credit cards, in actual, can help one to achieve the career goals too.

What is the purpose of corporate credit cards?

Corporate cards are a unique group in the greater spectrum of credit cards, which is different from the personal or small business credit cards. We can see many companies providing their employees with corporate cards to meet up with the business-related expenses, especially travel related. A fleet credit card is also an example of corporate cards. These are usually issued in the name of the company.

Unlike other types of business cards, the corporate credit cards are issued by only very few. The accounts of such corporate cards accounts are established by the businesses through banking relationship or over a deal which is directly negotiated with the users. A company’s credit history is also considered while establishing such a relationship.

Types of corporate credit cards

In terms of payment, there are two categories of credit cards:

Individual payment cards

The employees who carry such payment cards need to supply their expense reports based on the company policy and pay the issuers for any charges.

Company payment cards

Employers keep a tab of all the company-approved charges. The employers, however, need to pay the issuer for any unapproved or charges.

Regardless of what type of corporate credit cards are availed, the cardholders should first get familiarized with the spending and reporting specifications of the card as pointed out by the employers.

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