Survey shows travel, entertainment expenses affect company costs

MANILA, Philippines - Major corporations in Asia admit that a big reduction in travel and entertainment expenses would most effectively reduce their operational costs, according to a survey conducted by Citi and Visa International.

Conducted between April and August this year at client workshops hosted by Citi Transaction Services and Visa in the Philippines, Hong Kong and Taiwan, the surveys captured the business travel practices of over 90 large and multinational companies operating in these countries.

The majority of respondents confirmed that the use of corporate credit cards for travel expenditures is not widely adopted.

It said that less than half of those surveyed in the Philippines relied on this payment method, while respondents from Hong Kong and Taiwan, tend to rely on personal cards (38 percent) and electronic funds transfers (35 percent).

“The reliance on such decentralized payment methods raises red flags on operational inefficiencies, as well as a lack of transparency and accountability on business travel expenditure,” the surveyed revealed.

It further stressed that the difficulties are compounded since almost 80 percent of organizations in the Philippines do not have parameters and policies in place to provide guidance on business travel and entertainment expenses to employees.

Meanwhile, 60 percent of respondents in Hong Kong and Taiwan said that insufficient information or data prevents them from successfully trimming operational overheads.

The lack of an end-to-end visibility and control solution for complete traceability of travel expenses highlights a missing link to promoting good governance.

Citi transaction services regional product head for wholesale cards, Asia Pacific Deven Somaya said that the survey results prove the need for more robust data, process efficiencies, controls on expenses and an over-arching need to reduce costs.

Somaya likewise said that multinational and public-sector organizations globally leverage on data, processes and controls resulting in value for their travel as well as procurement programs.

Meanwhile Visa officials said that the survey only proves once more that Asia Pacific is one of the fastest growing regions in the world.

It likewise stresses that organizations need to improve on their travel and entertainment expense management.

“Organizations can achieve cost savings by managing expenditure more effectively with Visa’s commercial payment solutions which allow organizations to make a seamless transition to increased efficiency and greater control of their travel expenses.” Pradeep Roy, head of Commercial Prepaid, Risk and Loyalty Products, Visa Asia Pacific, Central Europe, Middle East and Africa.