The Importance of Fast Expense Reimbursements
Expense reimbursements. Yup, they’re necessary. But, why do they take so long to arrive in our pay packets? But, truth be told, this may be less of an issue for the business and more an inconvenience to the employee.
It’s not just the wait until payday – there’s all the paperwork too. An employee has to fill out a log of their expenses, have it signed off by a manager, make sure it’s then passed to accounts for clearance. That is, if they can find the original receipts…
There has to be a better way to handle all of this, surely?
You bet there is. Let’s get up to speed.
Knowing What To Expense
Officially speaking, an expense reimbursement is any cost incurred by an employee that can be paid back by the business. While, for the most part, there’s an expenses ‘baseline’ set by governments in different countries – over and above this businesses can decide what is and isn’t reimbursable’.
However, items like fuel and travel costs are almost always covered. So too are food and meal costs – when meeting with clients or suppliers or similar. But the list doesn’t end there. Depending on your business’ particular expenses policy, reimbursements can even extend to education and training.
In this respect, reimbursements can be used as more than just a fair return on employee spend. They can actually become a perk of their job. But when there’s a significant cost that employees without a company card are forced to shoulder, it has a negative impact on their personal finances.
Doing Right By Employees
Being out of pocket is never a nice feeling. While most employees can rely on their employer to pay them, having to extend credit to the organisation that pays your wages is certainly an odd dynamic!
Imagine that, for example, towards the end of a month an employee has to fill a vehicle with fuel for work and pay for it from their personal bank account. This could put them in a situation where they can’t afford other things until they receive their wage.
If this is a regular occurrence, the stress added to the employee from potentially being behind on other payments is going to spill over and be directed at the business.
Also, the employees most likely to be impacted by paying business expenses are those at the lower end of the income scale. This skew from high income to low is going to compound any feelings of resentment that employees might have toward the business.
This is why fast expense reimbursement is so important. It’s about doing right by your employees.
Expense Reimbursements Can Be Time-Consuming
As we’ve touched on, the traditional way to handle employee expenses and reimbursement has always been laborious and time consuming. With employees filling in forms, having to seek approval for them, and then passing them on to accounts for ratification can be stressful too.
Not to mention that any disagreements over the validity of the claim will just add more time and cause more headaches and resentment.
Most businesses have a cutoff point during each calendar month – so if a claim comes in after (or even too close to) payroll processing, then the reimbursement will wait until the following month – delaying repayment of credit further.
Ultimately, companies don’t want their teams spending time manually filling out forms, generating more work and taking time away from their other responsibilities – they want them to be able to add value.
Fast Payout Technology Offers Flexibility
Thankfully technology is helping us find ways to solve these problems. There are a variety of flexible software platforms that can help businesses when it comes to quick and easy expense payments.
Take Swish for example – a Swedish firm who offer a service where you authorise their payment platform with your business bank and then include them as part of your internal expense management system. Once that’s done, it’s ready to be used – it’s that simple.
Employees add their expense claims in their expense management solution and submit their report, which notifies the accounts team. They authorise the reimbursement and then the payment is made through Swish immediately and the employee is notified via the app.
This is good for the accounts team too. It frees up their time, enabling them to focus on the primary aspect of their role – not just chasing expense claims. Swish has proven it’s fast, secure, reliable and traceable which ticks all the boxes for businesses.
As you can see, getting employee reimbursements paid in a timely manner and in line with clear rules on what is eligible is key to empowering your staff and making your business more efficient.
No longer can businesses spend time running reports and timing all payments with wage slips. Reimbursements need to match the pace of the world we inhabit.
If managing fast expense reimbursements is something you are interested in, then get in touch today. At Findity, we strive to develop and innovate the field of expense management further while designing solutions to make life easier for all concerned.
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