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In a world of struggling supply chains and unexpected economic circumstances, ensuring cash flow and profitability is a top priority. But shockingly, over half (55%) of businesses are still relying on manual checks for their B2B payments – meaning they don’t have a clear view on what their teams are spending and expensing. This is set to change, however, as digitalisation is increasingly reshaping the way businesses keep track of their money.
One product of digitisation which has rapidly grown in popularity among corporate organisations is virtual cards. An efficient and streamlined solution to increase visibility over your business’s payments, virtual cards allow you to improve operational efficiency, monitor spending and stay on budget all while empowering your employees to take spend management into their own hands.
In fact, virtual cards have proven so popular among businesses in recent years that the global value of virtual card transactions is expected to increase from $1.9 trillion in 2021 to a staggering $6.8 trillion by 2026.
So, how do virtual cards work?
For many finance teams the business card, be it credit or debit is a source of huge worry and frustration. Cards are a quick, efficient, and widely accepted payment mechanism for businesses, but the fear of loss or misuse often leaves them locked in safes or desk drawers collecting dust.
Virtual cards are digital versions of the plastic or metal payment cards that you might have in your wallet. Virtual cards can be used in a variety of ways: shared amongst members of a company for things like online subscriptions and software, or for individual transactions such as in-person purchases (through the ability to be uploaded to your mobile device’s wallet), or crucially, attached to a specific balance defined by the business controllers.
For example, Equals Money Shared cards can be created and loaded to define clear spending channels for departments, teams, and projects. If you have a specific budget that you’ve set aside for your marketing team, you can create Shared virtual cards for a specific use-case such as ad-platforms, online subscriptions or marketing spend, linked to a defined balance within their platform. This provides clear purposes and limits for the cards, giving businesses greater control and visibility over employee spending.
Spotting pain points in your finance strategy
There are many administrative frustrations that come with running a business, ranging from chasing people to file expenses and dealing with decentralised teams, to estimating accruals. Ultimately, all of these tasks can take up valuable team time and keep you from what really matters: growing your business.
With virtual cards, you can access real-time transaction data and reports, so you know exactly what your teams and departments are spending and where. Additionally, virtual cards are issued instantly, allowing employees to start spending immediately, with all expenses tracked within the same centralised platform.
Ultimately, this technology saves your finance and accounting teams valuable time and money.
The importance of visibility over business payments
Having visibility over what your business is spending is vital for staying on top of finances and forecasting cash flow.
Through having the ability to set custom spending and transaction limits (defined by amount, frequency of use, or type of spend), virtual cards can allow you to accurately forecast spending by ensuring employees only spend within their allowance or remit.
What’s more, greater visibility over payments allows you to spot and prevent potentially fraudulent activity. Lacking the magnetic strip and visible numbers of physical cards, virtual cards are much more difficult to infiltrate by unauthorised persons. If any suspicious activity does occur, cards can be paused temporarily or cancelled via their online management platform and can easily be resumed or replaced from the same place.
How virtual cards could help your business to growth and thrive
By having greater visibility over your business transactions and cashflow you can work on cutting unnecessary expenditure, better budget and forecast and in turn focus on profitability and growth.
For more information on Shared cards and how they can benefit your business, please contact Equals Money at firstname.lastname@example.org.
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