Company Card, Corporate Card, Expense Card: The Four Models

"Company card" is not a product. It is a category containing four genuinely different arrangements that differ on who is liable, what was underwritten, and whether any credit is being extended at all. The marketing pages use the terms loosely and often interchangeably, which is how founders end up personally guaranteeing something they believed the company had taken on.

Model 1: The corporate card, with corporate liability

The classic large-company arrangement. The card is issued to the company, the company is the obligor, and the balance is settled in full each cycle — it behaves as a charge product rather than a revolving one.

Underwriting is against the company: its financials, its size, its banking history. There is normally no personal guarantee from the employee carrying the card, and often none from the directors either. Employees receive cards under the company's account with limits set centrally.

The reason not every business has one is that the underwriting is real. A company without the trading history to support it will not be offered this model, whatever the marketing suggests.

Model 2: The small business credit card, with a personal guarantee

The most common arrangement for smaller businesses, and the one most often misunderstood. It is a genuine revolving credit line issued to the business, but the underwriting leans on the owner's personal credit, and the account is typically backed by a personal guarantee.

That guarantee is the whole point of the model and the whole risk of it. If the business does not pay, the named individual is liable. The company being a separate legal person does not change that, because the guarantee is a separate promise the individual has made.

Whether the account also appears on the individual's personal credit file is a different question, and the answer varies by issuer and by country: some report routinely, some only on default, some not at all. Both exposures are worth asking about explicitly, and they do not travel together.

Model 3: The prefunded expense card

A large part of the modern spend-management category does not extend credit at all. The card draws against a balance the company has already funded, or against a limit that is topped up by a periodic sweep from the company's bank account.

Functionally this is a prepaid or debit instrument with a control layer bolted on: per-card limits, merchant category restrictions, receipt capture, real-time visibility, instant issuance and cancellation of virtual cards.

The trade is straightforward. You give up the credit line and tie up cash. You get no personal guarantee, no credit underwriting, no interest, and usually the best controls in the category. For a company whose constraint is oversight rather than working capital, this is frequently the right answer — and it is the model most often mislabelled as a "corporate card" in marketing copy.

Model 4: The virtual card for payables

The fourth model is not carried by anyone. Single-use virtual card numbers are generated per supplier or per invoice, with the amount and validity fixed in advance, and used to settle accounts payable.

The controls are the product: a number that only works once, for one amount, at one payee, cannot be reused if it leaks. It also converts a bank transfer into a card transaction, which changes the dispute rights available and the settlement timing. Virtual card numbers explained covers the mechanism in general terms.

Why the rewards look better than on consumer cards

There is a structural reason the commercial side of the European market pays more, and it is not generosity. Under Regulation (EU) 2015/751, Article 3 caps interchange at "0,2 % of the value of the transaction" for debit and Article 4 at "0.3% of the value of the transaction" for credit — but both articles are titled by reference to consumer card transactions. Commercial cards sit outside those two caps.

Interchange is the pool that funds card rewards, so a larger uncapped pool can fund a larger reward. That is genuine value and it is worth having. It is also the reason a business card's rewards should never be the first thing you compare: the liability model matters more, and it varies far more.

How to work out which one you are being offered

Ask three questions, in this order, and insist on written answers:

• If the company does not pay, who does? If the answer names a person, there is a personal guarantee, whatever the product is called.
• What did you underwrite? Company financials, a personal credit file, or nothing at all. This tells you which model it is more reliably than the name does.
• Is there a credit line, or am I spending money I have already sent you? The answer separates models 1 and 2 from models 3 and 4 completely.

Every one of these is a reasonable product for some company. The failure mode is not choosing the wrong one on purpose — it is believing you chose model 1 or 3 and discovering, at the worst possible moment, that you signed model 2.

For the charge-versus-credit control question specifically, business card charge versus credit controls goes deeper, and corporate card versus business card covers the first two models side by side. Companies at the earliest stage should start with business credit cards for startups.

This is general information, not legal or financial advice. A personal guarantee is a binding contract; read it, or have it read, before signing.