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A virtual credit card refers to a disposable credit card number that companies issue to employees for purchases.
Virtual cards allow employees to transact online or over the phone with greater security and spending control. Companies can generate a virtual credit card number that functions like a traditional credit card with a 16-digit code, an expiration date, and a CVV.
Companies issue virtual cards to reduce credit card fraud and help manage business spending. Virtual cards can pay for ongoing subscriptions or incidental business expenses like transactions without purchase orders or invoices.
Companies are embracing virtual cards for better payment management because of the following benefits:
Companies often use virtual cards that link directly to accounts payable automation software. Connecting virtual cards to the AP solution eliminates manual data entry and speeds up expense reconciliation and recording. Your transactions can be updated in real-time.
A virtual card provides better protection against hackers and other bad actors because underlying financial information cannot be accessed during the payment process.
Companies can also customize permissions for virtual cards to:
Virtual cards make it possible for companies to issue a card under the name of each employee. Modern accounts payable platforms require employees to upload supporting documents for each purchase made. Managers and cardholders receive notifications of declined, suspended, or canceled cards – creating a clear audit trail of what each employee pays for.
Virtual cards allow companies to use built-in controls to reduce out-of-policy spend. For instance, there are limits on how much an employee can spend for each period. By using virtual cards, all expenses should comply with company policies on travel and procurement, reducing non-compliance and allowing organizations to stop spending before it happens.
Using virtual cards to manage non-PO spending facilitates speed and accuracy in the AP process. Syncing virtual card transactions to your AP solution reduces the manual work required for data entry and reconciliation. Your ERP and accounting, speeding up
Issuing virtual cards tied to the company’s credit card account can create rewards and rebates for your organization. Rewards from virtual cards can generate savings for required spending.
Virtual cards make it easier for organizations to amass data for analytics. Finance teams can gain significant insights into spending to reduce costs, identify areas for improvement, and generate the highest ROI.
Virtual cards support spend and fraud management through recording credit card transactions, tracking expenses, and software automation. With SoftCoPay, organizations can say goodbye to a costly manual payment process and shift to a convenient and secure method to track expenses and manage spending.
Streamline operations in your AP department by issuing virtual cards to reduce costs, increase security, and save resources. Sign up for a free demo today.