The digital age brings a lot of convenience to businesses. One of the products helping businesses for more than a decade now is virtual corporate cards.
The use of a virtual business card is continuously gaining ground as more brands are opting for contactless and more manageable ways to empower their employees without risking the company’s funds.
Like a traditional business card, virtual corporate cards allow companies to manage and monitor daily expenses while enjoying some perks like purchase protection or cashback rewards. Even if conventional business cards bring these advantages, some businesses still prefer to use virtual business cards as these types of cards provide better benefits.
So, if you’ve been considering getting your employees a virtual business card but remain hesitant to do so, here are six benefits of a virtual corporate card for managing expenses.
Minimize Fraud and Increase Security
One of the benefits of using a virtual corporate card is the increased security it gives you and your company. According to a Nilson Report, payment card fraud losses globally reached USD $28.65 billion in 2019. This data shows the importance of keeping your corporate cards secured from being hacked.
Virtual cards make it hard for malicious entities to tap into your company’s finances to commit fraud through the following features:
- Untraceable virtual card number: Thanks to tokenization, a security feature, makes virtual card numbers untraceable. This payment method security feature replaces sensitive information to ensure that account details like names, addresses, and phone numbers are protected if these cards become compromised.
- E-wallet fund connection: Having a corporate card can be a considerable risk as these traditional corporate cards are typically connected to company funds. Instead of connecting to a corporate bank account, virtual cards are connected to virtual wallets or e-wallets that add another layer of security for your company’s money. This feature gives company owners a sense of added security should their virtual corporate cards get hacked.
- Controlled transactions: Typically, conditions and limitations over corporate cards come from banks. On the other hand, virtual corporate cards give business owners more control over who uses company money, how long these employees have the privilege to hold on to a card, and the maximum limit of transactions per day one can charge to the virtual corporate card. With this range of control, it’s easy to determine if a virtual card is compromised and simple enough to block it, rendering it useless in the hands of the wrong person. Having more freedom to control company funds grants business owners a sense of peace when issuing virtual company cards to their employees.
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Reduce Unnecessary Purchases
As mentioned above, a virtual corporate card makes it easy for businesses to track which card has suspicious transactions or is becoming problematic. This virtual card feature eliminates uncertainties for business owners in giving their employees a corporate card.
Since there’s an option to customize virtual cards, business owners and fund administrators can control which card can be used by which people, with a maximum allowed spending limit, and put an auto-decline setting that enforces their company’s financial protocols.
This level of control over how your company’s money is spent and the improved visibility of transactions is a benefit highly appreciated by business owners since eliminating unnecessary expenses can help maintain the health of the company’s cash flow.
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Real-Time Spend Visibility
Another benefit of having a virtual corporate card over the conventional company card is that it’s easy to monitor which account is spending on what purchases. Virtual cards make it easy for individual employees to have their own, making expenses transparent enough for the company to incorporate when making business decisions.
Expense management using manual processes is prone to reporting errors and requires a lot of reconciliation between the reports generated and the receipts that go with them.
Instead of spending lots of hours on paperwork, a company may want to use the powerful combination of expense management software and virtual corporate cards. With this said, consolidating receipts to every expense charged to the card, and details about these expenses are automatically available to the finance team.
Using these technologies makes it easier for your finance departments to track, monitor, and deliver accurate financial statements that will help optimize how your business operates, forcing transparency among all employees who are issued virtual corporate cards from your company.
Time and Cost-Efficient
Another reason why businesses give virtual corporate cards to their employees is to streamline the expense management process. Employees who are given virtual corporate cards need not wait for a physical card to get to them in urgent situations that require them to make a business purchase.
When used hand-in-hand with expense management software, virtual corporate cards also lift the burden of doing manual work to reconcile accounts with receipts and other supporting documents. Using this type of digitization eliminates the need for a middle man to collect and share receipts and other pertinent documents into an expense software, thus shortening the process and may even eliminate reimbursements.
With each step removed from the expense management process, it’s easier to monitor cash flow, save your business money, and give more time to your accounting employees to do other important tasks.
Better Data Analytics
Another benefit companies enjoy when using virtual corporate cards is robust data. With more businesses using advanced technology, using expense management software with virtual business cards makes complex processes more straightforward and more manageable.
More data may mean better insight if handled correctly. Data collected from virtual corporate cards can help the finance team determine which activities or market gives the highest return of investment (ROI), prioritizing more profitable activities.
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Conclusion
For businesses who are looking for ways to capitalize on how technology can help centralize their spending data, virtual business cards may be of help.
Integrating this type of payment method into your expense management processes helps ensure the security of your company funds, encourages transparency, and eliminates unnecessary spending that doesn’t generate any profitable results.
Finding the right one for your company is easy enough as more and more providers are penetrating the industry.