How Virtual Credit Cards Can Benefit Your Operations

Virtual payments have become almost routine for an increasing number of consumers. Digital wallets, in particular, have grown in popularity, with Forbes Advisor finding that 53% of today’s consumers now use their digital wallets more often than traditional payment methods.

Even more (72%) said they would consider using this payment modality as their primary payment method for shopping. Convenience was the main reason for their use, but enhanced security, a faster checkout process and the ability to track purchases were also cited as reasons consumers were choosing digital wallets over other payment methods.

These benefits of virtual credit cards, digital wallets and other real-time payment methods are some of the same seen when businesses adopt virtual payment platforms, and it’s also why more and more have started to make the move into this territory.

However, virtual card payment solutions can often be even more advantageous for businesses than consumers, largely due to the added functionalities that come with such a payment platform.

So, let us take a look at some of the main benefits of virtual credit cards for businesses:

1. Improved expense management.

Digital transformation has already been changing the accounts payable process, much of it involving the automation of more mundane tasks for AP teams (e.g., data entry, routing invoices, etc.). However, one Gartner survey found that 80% of finance leaders feel that their departments need to significantly accelerate technology implementation to effectively support the business by 2025.

Virtual credit cards, whether configured for one-time use or ongoing usage, may be part of the answer for many businesses. Once used, that purchase automatically shows up in the accounting system — with all the details about the transaction attached. No longer will your AP team need to track down the receipt to reconcile the payment. The information is already available, allowing organizations to better track and manage expenses, as well as streamline associated processes.

2. Improved control and accountability.

Virtual credit card payments for business also provide the benefit of better spending control and accountability. Prior to issuing a virtual card, for example, it can be sent through an approval process, during which spending limits are set, payment rules can be made and so on. You can even issue a virtual card number to be used exclusively at a certain vendor or supplier that can then be locked and unlocked as needed.

Again, your AP team is able to easily track and manage spending, as well as limit the back-and-forth often involved in the reconciliation process. Just as important, replacing paper-based, manual processes can help in reducing administrative costs and errors for your business.

3. Improved efficiency.

While we cannot speak to the benefits of virtual credit cards from other providers, i2c offers an easily configurable platform where businesses can create card numbers and set parameters for their use as needed. With our interface, issuers can provide this directly to business customers to create cards and track their use themselves. This not only provides an enhanced customer experience, but also eliminates the need for issuers to be directly involved, improving efficiency for all stakeholders while reducing operational costs and complexities in the process.

4. Improved vendor management.

With the ability for businesses to create virtual card numbers, set parameters for their use and automatically input associated transactions in the system, one of the added benefits of virtual credit cards is simplifying the vendor management process. You can easily see how much money is being spent at each vendor.

This data alone can help improve expense analytics and subsequent cost controls for the business. When a card number is associated with a specific vendor, it can lead to smoother coordination in the procure-to-pay process — an advantage for the business, as the speed of transaction may enable early payment discounts.

Virtual credit cards for businesses can be a game-changer, paving the way for greater digital transformation of the finance function — all while protecting capital from fraud, simplifying expense management, enhancing spending controls and making the procure-to-pay process much smoother. If you would like additional information about how virtual credit cards can help your business or want to learn more about our virtual card solutions, please feel free to contact us today.