Brex Business Credit Card Alternatives & Review

Brex Business Credit Card Alternatives & Review
Contents

If you’re reading this, you’ve been using Brex credit cards for quite a while now. You’re impressed with several of their features—and rightly so. Brex offers over $25,000 in benefits just for signing up.

But then, there are well...some major deal breakers with Brex that will get you doubting whether $25,000 in perks (most of which you’ll never claim) is really worth it. Now you’re back to the market fishing for a credit card that meets your business spending needs.

On the other hand, maybe you just came across Brex while searching for a credit card or spend management solution for your business’s needs. Brex seems to do a lot of things well, so you’re thinking this might be it.

Now, we won’t be bashing Brex for not being the best credit card out there. All we’ll do is to give you a breakdown of what a credit and spending tool like Brex should offer you. You can then use these criteria to decide between Brex or better alternatives.

Does the Brex card simplify the payment process?

Corporate credit cards are primarily expense cards designed as a means for companies to manage the payment process seamlessly.

So, how well does the Brex card do with simplifying the payment process? Not bad, but not great either.

Virtual cards

Right from your Brex dashboard, you can create virtual cards (powered by MasterCard) with predefined budgets, and they’ll go live in seconds. These virtual cards can be assigned to numerous employees in a universal card rollout, eliminating the need to share cards or spend personal funds on business expenses.

Brex supports a maximum of 10 virtual cards per cardholder, which should be enough no matter your organization’s size.

Physical cards

Brex lets you issue one physical card to each user and supports additional cards should you ever lose the first.

Bill pay

You can forward bills to Brex or create them within the dashboard. You can then schedule when they’re paid if you also have a Brex Cash account.

Does the Brex card reduce admin?

Besides simplifying payments, another key benefit of corporate cards is reducing the admin work needed to manage your entire organization’s spending footprint. Corporate cards built with spend management features empower teams of all sizes to manage their payment needs faster and more efficiently.

One way you can measure how efficient a corporate card like Brex is, is by measuring how much it reduces admin tasks so your finance team can focus on productive tasks. Does it:

Eliminate expense reports?

Traditional expense reports are a huge drag on modern companies and finance teams.

Employees spend company funds on whatever they deem necessary. Then at the month’s end, they send in reports outlining where all the money went.

On the other hand, real-time spend visibility and controls mean you can see expenses while your employees make them, approve or deny them as you see fit, and always have an up-to-date record of your budget.

Brex keeps tabs on transactions as they’re made. If you also open a Cash account alongside your Card service, you can approve or deny transactions from email, deposit checks, and view your balance on the go. 

This way, your finance team can approve or query expenses in real-time without waiting until the month’s end.

Eliminate reimbursements?

Another area where Brex helps simplify the payment experience is with reimbursements.

For companies that issue few or no cards to their employees, there’s always a huge overload of admin work waiting at each month’s end to reimburse employees that pay for work expenses out of pocket.

With up to 11 available to each user, Brex eliminates the need to spend out-of-pocket and get reimbursed afterward.

Receipt capture & OCR?

Brex cardholders can simply capture receipts for their purchases via the Brex app and attach them to charges on their cards. Brex’s powerful OCR software makes it easy to extract names, addresses, taxes, and other figures from receipts and export them to the backend for your finance team to review.

Accounting integrations?

Brex integrates with several of the major accounting tools such as QuickBooks and Xero so you can export data, reconcile your books, and keep track of your business’s financial health. 

Travel integration?

Brex Travel is actually a white label integration with TravelBank.

If your company has significant travel frequency, it’d be a wise decision to adopt a travel management tool that integrates with the rest of your accounting and expensing stack. This empowers you to manage travel-related expenses and maintain a single source of truth right in one place.

UI?

Brex sports a clean user interface with a focus on simplicity.

Setting up your payments and spend management on top of Brex are relatively easy, as well as a minimal interface on the app that offers an uncluttered user experience for your cardholders.

Does the Brex card give you real-time visibility into total spend?

Previously, companies had to trust employees to make compliant expenses and to ensure they were under budget. But if at the month’s end you discovered someone had overspent or made an out-of-policy expense, there was little anyone could do to get the money back.

Real-time visibility revolutionized spend management and created a way for finance teams to track spending as it happened, judge if it’s within policy, and either approve or deny them at the moment expenses are made.

If you’re in the market for a spending solution, you need to understand how much visibility you’ll be able to get into your transactions. Here’s how much of that Brex offers you.

Do you have to wait for expense reports to be submitted?

When expenses are made on a Brex card, they’re logged to the control dashboard, where they’re either automatically approved or require a finance staff member to sign off on them. This eliminates the need to wait until expense reports are manually filed at the month’s end to monitor spending.

Can you track accrued expenses?

Brex is primarily designed to make and track instant payments—not accrued expenses such as invoices. If a huge chunk of your company’s expenses are made on invoices sent in by suppliers, etc., you might have quite a hard time accounting for them until the moment you charge a card for the payment.

This means you’d never know when you’re in the red by simply judging how much cash is in the bank. And without a handle on accruals, your view on actual to budget performance will be miles off from finance.

Can you manage payroll with Brex?

Not directly. You can integrate Brex with a handful of payroll providers such as Gusto & Rippling. But you won’t get the seamless, connected experience a comprehensive solution would offer.

Can the Brex card prevent over-budget or out of policy spend?

No matter your company’s size, it’s important to keep a careful eye on how much your teams are spending. This helps ensure expenses are kept under budget and restricted to categories specified in your company’s expense policy.

So, how far does Brex go to help prevent over-budget and out-of-policy spend?

How do approvals and policies work?

Brex offers tight-knit policy and approvals management so you can easily educate employees on your spending policies, track their compliance, and send automated reminders whenever necessary.

All you need to do is build your expense policy with Brex’s template that enables you to designate supported vendors, specify transactions that require receipts, memos, or notifications, and create rules-based exceptions.

Brex’s expense policies aren’t designed as static documents for employees to read when they’re onboarding. Instead, they’re intended to serve as living documents that loop into your spend management system to restrict spending to specific categories and trigger notifications when expenses that require them are made.

Can you allocate budgets?

Brex allows finance teams to control how much cardholders can spend, but not in the way you’re probably familiar with.

Instead of limiting spending on individual employee cards, with Brex, you can put dynamic spending limits on a cardholder that then applies to all the cards they’ve been assigned and the expenses they make. This functions essentially as a budget they have to spend within all the cards they have access to.

Can you set card spend limits?

No.

While spending across Brex’s physical and virtual cards can be limited by assigning a budget to the cardholder, individual cards can’t be assigned specific limits.

This creates a lot of room for error, especially for employees responsible for making expenses across two categories. Without specific limits on each of the cards a holder possesses, it’s possible to spend the budget earmarked for one category of expenses on another without being detected.

Say a growth lead that also doubles as a PPC specialist is assigned two cards—one for marketing and growth and another for ads. The growth lead is expected to spend $7,500 on growth projects, and $4,000 on PPC projects. This adds up to an $11,500 monthly budget for the growth lead.

Because there’s no way to limit each card, it’s easy to spend growth marketing funds on PPC or vice versa.

On the surface, the employee in question manages to stay under budget but has made a disastrous mistake by using funds designed for one category on another. This mistake is most susceptible in a startup environment where one employee may wear different hats—the very people Brex claim it’s built for.

In conclusion, Brex helps you create dynamic expense policies but falls short at helping you enforce them. With absolutely no spending limits on individual card spending, it’s easy to get things wrong.

Does the Brex card empower your team to manage their budgets?

The aim of a corporate credit card is to empower your team to make expenses and purchase the supplies they need to do their work. This cuts down the oversight and admin work required to manage everything centrally.

While Brex offers core finance teams a good measure of control over cardholder spending, it might be a little too much.

Budget to actual reporting

For all the nice features it packs, Brex doesn’t offer budget to actual reporting—a powerful tool that tracks projected expenses alongside actual expenses for each individual cardholder.

This might be a huge disappointment for you, but remember, Brex is primarily a corporate card with features built in to make it more relevant to their target users.

If you need to keep an eye on budget to actual reporting, you’d need a more comprehensive tool to support expense management without skimping on more serious features like individual budget management.

Budget owner permissions

As it stands, Brex offers the individual cardholder little autonomy over what they can do with their available funds.

All a budget owner can do is spend the funds allocated to them across the cards they control and provide memos and notices to accompany each spending in the expense policy’s gray area. This leaves a good deal of control in the budget owner’s hands, but not too much to abuse funds or make out-of-policy expenses.

What are Brex card’s fees?

No annual fees, foreign transaction fees, or any interest charges as long as you pay off your balance when the 30-day credit period elapses.

But if you end up not having enough cash in your checking account to cover your monthly credit usage, Brex’s fees can get nasty real quick. Brex charges anywhere from 13 - 20% interest on any credit usage that isn’t settled in full once a 30-day period elapses.

How do I qualify for the Brex card? 

If you’re still on the fence about choosing the Brex card, the first question you should be considering is whether you even qualify. This helps you eliminate back-and-forth and only invest your time and energy if there’s a fair chance you’ll get accepted.

Sadly, Brex puts a huge roadblock in the way of would-be users with requirements that are out of the reach of many companies.

To qualify, Brex requires that:

  1. You have $50,000 - $100,000 in your business checking account, and that,
  2. You’re a funded startup in tech or life science.

Brex doesn’t factor personal credit scores into the underwriting process. This can be a huge boost for business owners who satisfy Brex’s main requirements but lack a stellar personal credit history. Likewise, Brex reports your repayments to credit bureaus (Experian and Dun & Bradstreet), so you can build good business credit on autopilot.

It appears Brex’s main targets are funded companies that have a huge chunk of cash at hand. If you don’t fall into that bracket, it might be harder, if not impossible, to get approved for the Brex corporate card—even if you have a good balance within their $50,000 - $100,000 requirement.

With all the hoops required to get approved for Brex, there’s a huge possibility that you eventually might not.

Brex perks. Are they worth the cost?

If there’s one area where Brex does a spectacular job, it’s the perks and rewards they offer for signing up and using your Brex card day-to-day.

We all love a great bargain, and Brex understands this. But, the big question is whether these rewards are worth the potential cost of using Brex. And, whether the average business can make the most of these rewards or whether they’ll just end up going to waste.

Flexible credit limits

One of the benefits Brex pitches to potential users is a credit limit that’s higher than what traditional banks would offer to businesses. Brex does this by considering factors like spending patterns to determine your credit risk.

But, how much of a benefit is it?

Brex’s dynamic credit limits change so much that it could be $10,000 today and $4,500 by the end of the week.

And if there’s an area where you need clarity and certainty in your business, it’s your finances. You’d want a concrete idea of the figures you’re running on and how far they can take you.

But Brex essentially does away with all that. With a flexible credit limit that makes it hard to make reasonable projections based on the credit you have available, Brex’s perk ends up being a disadvantage.

Brex’s rewards are designed around software & life science businesses. Are you one?

Typically, Brex offers a generous rewards program on card spending, including:

7x reward points on rideshare, 4x on travel, 3x on restaurants, 2x on software subscriptions, and 1x on everything else.

Even better are the partner rewards Brex offers on the tools an average business uses, including:

  • $5,000 in AWS credits, and up to $100,000 in AWS Activate
  • 25% off 12 months of eligible Slack plans
  • $150 in Google ad credits
  • Instant 5% rewards on Microsoft ads
  • Up to 40% off select SaaS subscriptions such as HubSpot, Dropbox, Carta, Zendesk, Zoom, WeWork, and Intercom
  • Discounts on lab supplies (for life science startups)

All these are quite juicy rewards for software and life science businesses, but if you’re not one, it’s going to be hard leveraging a meaningful amount of Brex’s benefits. Since Brex is laser-focused on a very thin user niche, certain business owners might have difficulty getting long-term value out of what Brex costs.

A $100,000 security deposit for just 30 days of float?

The Brex card is marketed as a corporate credit card for managing all your business expenses—and it does the corporate card part spectacularly well.

But is it really a credit card? Not exactly.

In its purest form, a credit card lets you spend from the credit issued to you, pay off a minimum required amount, and charges you interest for whatever’s left unpaid. This helps you run your business without unlimited cash in the bank, and channel funds where they’re most useful.

Brex’s card, on the other hand, requires that you connect your business bank account and maintain a minimum balance between $50,000 - $100,000—a steep amount for a significant number of businesses.

Likewise, Brex automatically charges your usage on your bank account every 30-day cycle. Should you have insufficient funds to cover your full monthly usage, you will be charged interest rates ranging between 13% to nearly 20% on your remaining balance.

So, Brex ties down a $50,000 – $100,000 security deposit, charges your entire usage at each month’s end, and charges outrageous interest rates for any unpaid balance—all for just 2% cashback and 30 days of float?

This is a huge barrier to entry for most business owners without any guarantee that your application will get accepted.

Brex vs. Lola.com

If you are not this sort of company, Brex may not meet your needs. 

Lola.com is the spend management solution that saves you time managing budgets, expenses, and travel. Our product focuses on giving you control over spend before it happens with budgets. And it’s 100% free. With Lola.com you can:

  • Empower your team with unlimited physical and virtual employee cards
  • Control expenses at the point of spending
  • Eliminate expense reports and reimbursements
  • Set dynamic controls on each card employees are assigned

Here’s a simple credit card checklist that’ll serve as your guide to choosing between Lola and Brex for your company’s payments and spend management needs. 

brex vs. lola.com

Who is a good fit for Brex?

Brex is a modern bank for venture backed companies. Brex is a good fit for:

  • Tech or life science startups
  • Companies with large cash reserves or venture funding

Who is a good fit for Lola.com?

Lola.com is the spend management solution that saves you time on budgets, expenses, and travel. Lola.com is a good fit for finance teams that want to:

  • Quickly deploy corporate cards across their company
  • Empower their budget-owners to manage their own budgets
  • Control spend before it happens with budgets
  • Eliminate expense reports
  • A fully integrated travel management platform

Lola.com is free, and easy to set up in 30 minutes or less. Try it today.

Lola.com is the spend management solution that keeps you on budget.


About the Author: Churchill Leonard
Churchill Leonard is a freelance content writer focused on the startup fintech space. He currently runs Content Strategy at Publoft.com.