What is a fuel card?
A fuel card is a payment card specifically designed for purchasing fuel. It is similar to a credit card but is limited to fuel and related expenses.
How does a fuel card work?
When using a fuel card, the cardholder can easily pay for fuel at designated fuel stations. The card is linked to a specific fuel account, which is set up by the card provider. The cardholder can swipe the card or enter the card details at the fuel station's point-of-sale terminal. The transaction is automatically recorded in the fuel account. Some fuel cards also offer additional features like tracking fuel consumption and generating expense reports.
Benefits of using a fuel card for tracking fuel expenses
1. Convenience: With a fuel card, there is no need to carry cash or submit reimbursement forms for fuel expenses. 2. Control: Fuel cards allow businesses to set limits on fuel purchases and monitor transactions in real-time. 3. Cost savings: Fuel cards often provide discounts, rewards, or negotiated prices at specific fuel stations. 4. Reporting: Fuel cards offer detailed reports on fuel usage, expenses, and mileage, making it easier to analyze and manage costs.
How to track fuel expenses with a fuel card
1. Choose a fuel card provider: Research and select a fuel card provider that offers the features and benefits suitable for your business needs. 2. Set up a fuel account: Contact the chosen provider to set up a fuel account linked to the fuel card. 3. Distribute fuel cards: Provide fuel cards to your drivers or employees who need to purchase fuel. 4. Monitor and analyze transactions: Regularly review the fuel transactions recorded in the fuel account. 5. Generate reports: Utilize the reporting tools provided by the fuel card provider to generate expense reports and track fuel usage. 6. Adjust fuel limits if necessary: Monitor the fuel usage patterns and adjust the card limits accordingly to ensure control and cost savings. 7. Communicate with drivers/employees: Establish clear guidelines and communication channels to ensure compliance with fuel card usage policies. 8. Keep track of mileage: Many fuel cards allow mileage tracking, which can be useful for managing overall vehicle expenses.