PEX Card is offering prepaid cards to small businesses to help them manage expenses and deal with disbursing money to employees for on the job expenses. The company is focusing on companies like contractors and plumbers where an employee may need to buy materials in the course of their jobs.
From American Banker:
The PEX Card allows small business owners to establish sub-accounts for each of their employees. When the firm’s employees are in a retail store, ready to make a purchase, they can notify their boss, who can immediately transfer sufficient funds to the appropriate sub-account.
Still, PEX card has to battle the traditional forms of payment – cash, checks, credit cards and debit cards – and it needs to fight against employees who might prefer to use their personal cards to get some kind of reward like airline miles.
At the same time, owners of small businesses may also face liquidity issues that drive them to use credit cards. While prepaid cards could present a compelling business case for some small businesses, programs will need to have additional features such as account management, expense tracking and possibly even rewards to help them compete against other forms of payment.
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