What’s the difference between an authorized user and an employee card?

Apr 18, 2021

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Editor’s note: This post has been updated with new information.


Whether you’re a parent looking to help pay for your children’s living expenses or a business owner trying to streamline your company’s spending patterns, you may want to add an additional user to your credit card account. TPG reader Kevin wants to know what the difference is between an authorized user and an employee card…

I’m trying to add additional cardholders on my small-business credit card and it says “request employee cards.” Is that the same as adding an authorized user?

TPG READER KEVIN

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Kevin’s right — while the terminology is different between business and personal credit cards, there isn’t a huge difference between adding an authorized user on your personal credit card account or an employee card on your business account. In both cases, you’ll ultimately be responsible for any charges made on the card, so make sure you only give it to someone you trust. Also, consider putting a spending limit on the card if your issuer allows you to do so.

Beyond that, the only real differences are what you’d normally find between personal and business credit cards. Most business cards (including employee cards) don’t report to your personal credit report, so these cards won’t affect your credit score. Meanwhile, adding a friend or family member as an authorized user on your personal credit cards is one of the fastest ways to help them boost their credit score. Additionally, most business cards include expense-management tools that can help you better manage your employees’ spending on their cards.

Related: Credit cards with the greatest value for authorized users

Bottom line

At the end of the day, there isn’t much of a difference between employee cards and authorized user cards. If you have a personal credit card, you’ll add authorized users, and if you have a business card you’ll add additional employee cards. Just make sure to do so thoughtfully, as you, the primary account holder, will be on the hook for all charges made.

Thanks for the question, Kevin, and if you’re a TPG reader who’d like us to answer a question of your own, tweet us at @thepointsguy, message us on Facebook or email us at info@thepointsguy.com.

Additional reporting by Stella Shon

Featured photo by Hero Images/Getty Images

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