Fleet management fuel cards: Everything you need to know
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Owning a business with vehicles requires spending a lot of money, especially on fuel. Nowadays, fuel and maintenance expenses are the top priority for fleet drivers, though their prices are increasing. As a manager, you should be able to timely report the daily, weekly, or monthly costs of your fleet.
Luckily, you can do this with the help of fleet fuel cards – a more comprehensive and easy way of having access to fuel reports in real time. These are an excellent for a business fleet, but you must know how to use them correctly or your money will end up down the drain.
But how do you manage a fuel card program and what are the main steps you should follow? Since this is a critical aspect of your business, we’ve included the basics of using a fleet card, along with the benefits you should expect from them.
What are fleet cards?
Fleet cards are specifically designed for business fleets as a type of payment card that can be used for fuel at gas stations. The fuel cards market size is constantly increasing and is estimated to grow to $1,210,01 billion in the next four years.
Although most people tend to confuse these cards with gas station reward programs, fleet cards are more specific. In other words, they function more or less like a credit card or a charge card. Additionally, they’re usually licensed by companies that provide cards like WEX, or oil-brand companies such as Shell.
Fleet cards are then issued to fleet managers and their drivers for any costs regarding the operation of their vehicles, such as paying for fuel or maintenance. While some cards are widely accepted anywhere, some are closed-loop and can be used for a specific use or at a specific place.
Although the usage of a fuel card is simple, sometimes it may require further information during the authorization part, including the following:
- A driver number
- The input of a unit number
- The current vehicle mileage
All of this information is set and used by the fleet owner for general tracking purposes and gathering other reporting metrics.
One thing to note is that fuel cards are best used for businesses that buy approximately 1,000 gallons of fuel monthly as they can help with discounts and other advantages.
Top 6 benefits of using a fleet card
Since the demand for fuel cards is yearly increasing, the primary factors for the growth of the global fuel cards market are that fleet cards allow managers to track fuel costs and purchase in real time. However, one of the main responsibilities of a cardholder is the card’s features and payment options.
Luckily, if your fleet trusts renowned businesses for their fleet cards, they’re likely to have more control over their vehicles’ efficiency and savings. For example, you can have large fleet card options from Comdata which allow you to manage and report your drivers’ fuel expenses and other transactions.
That said, the benefits of using a fleet card are numerous, but we’ll only mention a few:
Greater control over fuel and maintenance costs
Undoubtedly, one of the biggest advantages of using a fleet card is that it allows you to improve your cost controls regarding fuel and maintenance expenses. The comprehensive and detailed reporting that these cards provide is what makes you track costs in real-time and identify potential inefficiencies or overspendings. As a result, you’re able to make smarter decisions and data-driven reports to decrease costs.
Smooth spend management
Among many other benefits, there are specific fleet cards that can smooth spending management by reducing the need for fleet drivers to have credit cards or cash. Additionally, fleet managers can take advantage of this and use it to monitor the card’s activity and costs. Or, they can also set up purchase restrictions or spending limits to avoid unauthorized spending.
It’s essential to note that if the fleet card is only used for fuels, the manager must have a second card in hand or a reimbursement process for costs like incidentals, maintenance, or tires.
Improved security and fraud elimination
Fleet cards are extremely helpful for improving security features that you won’t likely find in other typical credit cards. These cards usually PIN codes and driver IDs to continue with the transactions, which makes them less likely to endure fraud.
At the same time, card fraud is a significant problem for all fleet businesses. However, you should know that these cards don’t stop fraud entirely. Modern fleet cards, on the other hand, are well aware of fraud’s impact on a business. That’s why they work towards enhancing security and preventing any type of fraud.
Improved cash flow and advances
Thanks to their flexible payment regulations, fleet cards can easily help improve cash flow and reduce the need for fleet drivers to pay with their own money. This is especially great for smaller businesses that have just joined the market and started using card fleets.
Similarly, most fleet cards provide cash advances to drivers, meaning they can buy something with the card, but then the money is deducted from the driver’s pay. Those advances can be beneficial for drivers who don’t carry cash or a personal card on the road, plus it helps with their retentivity.
Access to discounts
As mentioned, certain fleet cards offer discounts and rebates for fuel purchases. Over time, these can add up and save you plenty of money. However, be cautious of hidden costs that can outweigh or delete discount savings as many of these programs can charge. Still, some fleet cards have no hidden fees and they can provide numerous locations that offer discounts.
Improved productivity
One of the best assets of modern fleet cards is that they increase productivity by integrating other business systems. They do this by automating manual activities, such as fuel route optimization, bookkeeping, tax calculation and filing, and more.
Can fleet cards help your business?
If you’ve made it this far, you’re probably aware of the benefits of fleet cards for your business. These are essential tools for any type of company that uses vehicles, by helping them save thousands of dollars yearly per vehicle, as well as improve productivity.
Fleet cards also provide multiple benefits, from enhanced cost control to improved security and access to many discounts. So, if you’re looking for ways to make your fleet business stand out, a fleet card program is exactly what you need.