Guide on corporate virtual cards for business
Virtual credit cards are the newest addition to timesaving and efficient financial practices. As monetary work becomes further digitized, virtual cards for business have not only become safer and easier - they’ve also become quicker to integrate and begin using. Corporate virtual cards have changed the game for employee expense management. The ease in setting limits and traceable expense patterns make them a gift to financial teams worldwide.
Why the need of virtual cards for business? They offer spending controls and security. They’re easy to use and easy to ditch. They come with rewards and expense management tools. As your company grows larger, keeping a track of employee expenses is important for accounting and planning. Not only are virtual credit cards a frugal option; they also happen to create an easy-to-follow trail of transaction details. Take a look at how virtual cards for business can take your company’s financial planning to the next level.
Corporate cards are linked to the company’s budget. In this way, employees can pay for business-related expenses without having to use cash or their personal cards.
Virtual cards for business are a company liability and they don’t affect employees’ personal credit scores or loans. Rather, the company pays back all credit loans and designs policies on how the card needs to be used.
Corporate Virtual cards go one step further and digitize this process for safety, health, and ease of record transcription. Virtual credit cards also happen to be easier to issue and freeze, removing the hassle of transferring physical cards from employee to employee.
Physical cards are best for employees that are not shifting departments or moving in the near future (for instance, upper-level management or C-suite executives). On the other hand, virtual cards are beneficial for rotating employees and one-time expenses. They are linked to a digitally generated card number, and the administrator can decide who the card should belong to, what the limit will be, and when it will expire.
They are as easy to use as any other payment gateway or money transfer app and come without the risk of theft or loss. Instant virtual cards are also unlimited in their generation capacity, unlike physical cards.
A virtual credit card is a digital version of a credit card. It functions in the same way as a physical card without there being an actual physical equivalent. With a unique 16-digit number, virtual credit cards are a quicker way of accessing a credit line and handling expenses.
A corporate virtual card can be issued by a fintech company, financial institution, or online banking service. They also have better data protection since they can’t be stolen or lost like a physical credit card. They are as credible as physical cards and do make a difference to your credit score.
Virtual debit cards are an online version of physical debit cards. They are linked to a bank account and can be utilized for transactions where the option to swipe or tap a chip is absent. Commonly linked to apps like Apple Pay or Google Pay, they make online purchases easier.
They are accessed through your bank’s mobile application and have the same features as a physical card - a unique number, the ability to set a unique passcode, unique CVV. The only drawback is that they cannot be used with a card machine or to withdraw funds from an ATM.
Virtual cards for business can be generated with just one click - that is what makes them so easy to use. Fintech companies like Volopay offer the ability to create a card with just a minimal amount of information - the name of the user, your choice of credit limit and expiration date, and which departmental budget you want to associate the card to.
These virtual cards for business can be monitored efficiently with all transactional data appearing in real-time on the administrator’s interface. Additionally, creating one-time use cards or vendor-specific cards becomes possible with this one-click creation option. As soon as a card number is generated, it is ready to use.
Single payment cards came into existence because of the advent of gift cards. Designed for one-time use, they have not become helpful for companies that need to provide employees with cards for a single event or transaction. They’re quite easy to create. You simply have to specify the expiration date for them, as well as the amount of credit you would like to load. With companies like Volopay, you can also link these cards to your policies so that they follow the right protocol for use. They can also be linked to budgets for better bookkeeping.
Recurring payments make up a large portion of spends in any department or company. Usually SaaS, but also for fixed contract vendors, these invoices have a tendency to get lost. There is even a risk of making payments twice. Having a dedicated corporate virtual card for vendors and recurring payments makes the management task smoother. Corporate virtual cards can be created for specific vendors, and all invoices and receipts can be attached to that card. This makes spending analysis and accounting much faster with less errors.
Virtual cards do not propose the same kind of data loss risk that physical cards do. Since they cannot be swiped at a vendor or ATM machine, there is a highly reduced risk of hacked software getting the card information.
Additionally, since these cards can be linked to specific vendors without being attached to your company’s bank account, your banking information stays safe. Having a different virtual card for different vendors also lets you identify which payment gateway is posing a risk. Compliance teams can, then, track any issues without having to sort through a web of information.
While spending out-of-pocket can definitely be tracked, it is a very arduous process. There is always a risk of human error, misreporting, and paperwork getting lost. Spend management platforms allow for integrations with accounting software.
Your virtual card provider can let you link your transaction history with your software of choice. After that, it is simply a matter of integrating it with your card, and all your transactions are synced with the accounting system for the finance and compliance teams to go over.
Virtual card transactions get immediately recorded, with a real-time spend report being generated. Spend management systems like Volopay have web, email, and mobile applications for you to get notified every time a card is swiped and what the transaction information is. These spends can also be analyzed and synced with your accounting software in real-time.
This kind of transparency in spending patterns inculcates a healthier spending culture among employees, and also holds them accountable for all transactions. Real-time transactions also allow approvers to immediately respond to budget increase requests, verify uploaded receipts, and decline transactions.
All employees that spend company money can be issued a card in their own name. Since cards are linked to budgets, departments can also better track how and when their money is being spent, and how they can optimize their financial plans. Virtual credit cards don’t just make accounting faster - the actual transaction is quicker, too.
Since credit cards don’t require the same kind of sanctions as debit cards or wire transfers, cross-border and domestic payments are a lot smoother. There is also lesser risk and liability since the payment works on a credit basis instead of a money transfer.
It might feel scary to just hand over virtual credit cards to your employees, but rest assured this process is fully under the control of the company’s administrators. Virtual cards for business have the option to be customized in its usage rules.
You can choose which card can be used by which people, who approves any changes in the limit, and what the maximum allowed limit can be. All delegated approvers have the authority to decline expenses if the details provided are not sufficient. There are also auto-decline settings that help enforce financial policies.
The entire goal of expense management software is to streamline the process. Whether you rely on manual paperwork or data entry, it is still a lot of time and money wasted in managing your expense records.
This only gets further complicated when you need to create analysis reports. Digitized expense management and virtual credit cards can automate a large chunk of this process. Not only is the data less likely to become redundant, but it is also easier to perform any analytical functions on it.
Shadow spending or shadow spend is a phenomenon where procurement policies are bypassed by employees to enable purchases on corporate credit cards that have not been authorized prior to the purchase being made.
The best tool that can help prevent shadow spend is the virtual card. You can simply load the card with only the amount that has been authorized to be spent, so the question of overspending or unauthorized spending does not even arise because there will be no excess funds available.
Eligibility for virtual cards varies from country to country, as well as card provider to provider.
For instance, in Singapore, UOB and American Express only issue cards to companies that have a minimum of 15 authorized employees. Although the limitation is not set on travelers anymore, it can become tricky to pinpoint which 15 employees (to begin with) will be issued a card. Before applying for a corporate card program in Singapore, ensure that you have a minimum of 15 employees assigned as authorized cardholders.
Companies also need to have an annual revenue greeted than $4 million, and annual expenses of at least $250,000. These numbers should be verifiable and pinpoint to a structured organization with tangible financial plans.
Although corporate cards do not require you to attach your personal credit score to the application, the company’s taxation history, spend history, and credit score are an important part of determining if they will get approved for a corporate card program.
You can apply for a virtual card program with either a banking establishment or a spend management platform such as Volopay. Keep in mind that your personal credit score does not determine your eligibility for a corporate card program.
All your documentation that is requested will be company-related and will need you to fulfill the terms and conditions for virtual card eligibility of that country. Your card provider might also have certain requirements for issuing virtual cards. This process might seem daunting but it is much smoother than it looks.
Or simply, get corporate credit cards with Volopay. We will assist you in the process and help you understand what to expect throughout the application process. Once approved, your account will be onboarded and your finance team orientation will begin. After that, your virtual cards are just one button click away.
Volopay’s corporate card program is ideal for businesses scaling up, or already booming and looking for expense management solutions. We offer a variety of services, and your team can take a walk through them! Schedule a demo with Volopay to see how our interface looks, what tools you can use to your benefit, and how to manage finances with us!
Volopay has some of the lowest exchange rates in the market! Cross-border payments are supported with swift and non-swift payments, and over 130 currencies are present for you to choose from. Your Volopay virtual credit cards make the headache of international transactions nonexistent!
Virtual cards can be issued with a click of a button on the Volopay administrator panel. Simply choose which budget the card will be linked to, whose name goes on the card, and what your expiry date of choice is. Define the credit limit and your instant virtual card is ready for immediate use. Opting for a Volopay corporate debit card lets you add money from your bank account. If you opt for a Volopay credit card, you can avail business credit line of up to $500K. The credit will be preloaded to your cards.
Volopay’s reward system is pretty rewarding (pun intended!) While other corporate card providers issue points or gift cards, Volopay offers a no-nonsense cashback. Depending on which plan you choose, you can earn back up to 5% cashbacks on all foreign transactions! No loopholes, no hidden clauses!
Monitoring a high volume of virtual corporate cards can be tricky. Volopay aims to make your work less tedious, especially when it comes to approvals. You can set spending limits on all cards, as well as spend controls. These allow transactions over certain amounts to require specific approval and auto-decline any transactions that go against your company policies.
If you have a specific vendor you make frequent payments to, recurring or otherwise, you can create an instant virtual card just for that vendor. Assign a budget to the card, and load the amount you wish to. This lets you track all transactions for a vendor in one place, all of which are synced to your accounting software. Having vendor-specific cards also protects you from data theft, since the same card is not being used for all vendors - so, any possible leak is easier to catch and resolve.
As a Volopay client, you will have full control over how your company’s transactions take place. You can set up custom controls on cards, deciding which ones are renewable, which ones are one-time use. Company policies can be modified to suit your needs, and department-specific policies can be assigned to budgets (all of which get automatically linked to cards under them). You can also delegate multi-level approvers for specific cards and budgets to control whose authorization is needed for a transaction or reimbursement verification.
Volopay’s software matches receipts to invoices, all of which can be traced on the same interface. Pending invoices can be highlighted, and paid invoices can be automatically linked to receipts and the virtual corporate card used to pay them. All of this data can also be synced to your accounting software of choice. Volopay allows integrations with bookkeeping software like Xero, Quickbooks, and Netsuite, none of which requires any manual transliteration or editing. Simply plug and play to access your paper trails and spend analytics.