Care homes are seeing the end of petty cash and are transitioning to digital solutions, according to recent figures from expense management specialists Expend.
Their latest data confirms that the uptake of digital expense management in care homes, for elderly and youth residents, has risen by more than 125% in the past 12 months.
CEO Johnny Vowles says the care home sector is “accelerating toward the adoption of digital expense management, signalling the demise of traditional petty cash for everyday business expenses.”
For a long time, petty cash in care homes has been the default choice for handling small, day-to-day expenses. These can include regular purchases made for residents, such as weekly shopping, online purchases, as well as haircuts, trips and coffees.
However, it presents its own set of challenges. Physical cash transactions are not only cumbersome but also susceptible to issues like loss, theft, and a lack of accountability. Managing and reconciling petty cash transactions can become a time-consuming task, leading to inaccuracies and potential financial discrepancies.
Johnny Vowles explains: “Care home managers often find themselves juggling multiple responsibilities, and the last thing they need is the additional burden of manual expense processing.
“Care home teams are recognising that digital solutions automate repetitive tasks, such as data entry and approval workflows., This automation frees up valuable time for managers to concentrate on providing quality care.”
He adds: “Digital expense management signals the modernisation of conventional expense tracking and reimbursement processes, through digital tools and technologies.”
Prepaid cards and apps: a modern solution.
Expend say that managing care home expenses is complex, with varied needs across multiple locations, staff, and volunteers. Juggling numerous receipts and payment methods adds to the challenge.
Johnny Vowles explains: “One of the key problems of petty cash, for care home managers, is the need to use or drop off cash. This creates issues with physical security of the cash, reconciliation of spend, and the potential for theft. Care homes are increasingly recognising the value of prepaid cards, often known as expense cards, as well as apps, in managing spend.”
He adds: “These provide a digital alternative to the challenges posed by petty cash. Cards can be used by care managers, care staff and other employees within a care centre, and each card can have a unique spending limit, offering a secure and controlled method for managing daily expenses.”
Care home teams often find it difficult to track and reconcile cash spending incurred on behalf of their residents. However, digital solutions can provide focus and accuracy, for example card spend can be controlled and capped for employees. Accounting for individual spend is automated, so spending for specific care home users can be tracked in real time, with expense reports being visible instantly. It also makes monitoring of card spend easy, for both care home management teams and the reassurance of the care users’ families.
Prepaid cards are issued by universal operators like Mastercard, so are accepted everywhere and, linked to a smart phone app, receipts can be processed to an app right after transactions take place, for hassle-free reporting.
This approach means that team leaders can oversee spending at a glance, and with an expense management app, spend can be managed on the move. Employees and managers can use the mobile app to submit – or approve and review – expenses wherever they are, as they are not locked to desktop software.
Johnny Vowles says “Care home managers are embracing digital expense management at an unprecedented pace. They can see that a digital approach brings a broad range of benefits for their care homes and staff, directly improving operational efficiency, financial accuracy, and staff satisfaction.”
He continues: “Traditional expense management usually means that care home teams have to endure clunky paperwork, manual data entry, and the headache of misplaced receipts. Instead, a digital approach can now streamline the entire expense lifecycle, from submission to approval and reimbursement.
“In a continuous bid to improve operational and cost efficiencies, more and more care home managers are turning to digital expense management as part of their cost saving strategy.”
