Virtual debit and credit cards are powerful financial tools for individuals and businesses alike. Virtual cards let you protect your account information from fraudsters and data breaches by giving you a temporary account number that you can tie to an actual card.
On top of the security perks they’re popular for, business virtual cards have many other benefits to offer your company.
What are Business Virtual Credit Cards?
A business virtual credit card is a type of business credit card. However, unlike a typical business card, virtual cards don’t exist physically. Instead, they exist online and are designed for use when making online payments or purchases.
Some business credit cards are virtual by default. Other cards allow business owners to create virtual card numbers that associate with their existing accounts. You can use those virtual card numbers to make a purchase with your credit card without exposing your card number or details. You can also track spending by the virtual card used.
For example, if you have a credit card with the account number 1234 5678 9012 3456 on the physical card, you could create a virtual card with the credit card number 4568 1231 5555 5555. When you give that virtual card to an online merchant, they’ll be able to charge transactions to it. However, the purchases will appear on your actual credit card account in real time.
8 Benefits of Virtual Credit Cards for Business
There are many benefits to using virtual credit cards in your business.
Security is one of the top reasons to use virtual credit cards.
Imagine a scenario where you have one credit card and ten vendors. You give every vendor that card number, and they charge your purchases to the account.
One day, a vendor experiences a data breach, and your corporate card details, from the account number to the expiration date, get leaked. Suddenly a fraudster starts using your card to make fraudulent purchases.
To get back on track, you’ll have to cancel the card, get a new account number from the card issuer, then notify all ten of your vendors about your new card information, which is a major hassle.
With virtual cards, you can generate a new card for every vendor your work with. If one has a data breach, solving the problem is as easy as deleting that card number and creating a new virtual card. Plus, hackers won’t get access to your actual account information.
Virtual credit cards can make it much easier for business owners to keep track of their spending.
For example, you can give each employee a unique card number and track their spending. The virtual card will provide an immediate view of employee expenses so you can catch any oddities or track changes in an employee’s spending habits.
A small business might also create virtual cards for different purposes. One could be for subscriptions and a second for online purchases from retailers. You can assign spending limits to each card to ensure you don’t exceed the budget, making expense management simple.
With the granular tracking that virtual cards enable, you can also use data analytics to guide future spending decisions.
For example, virtual cards can make it simple to track spending for individual trips or for conferences you or your employees attend. If you know that you spent $2,372.93 to travel to a conference and meet potential clients, you can consider that information and the amount of business secured at the event to better decide on future travel plans.
Many online financial companies like dash.fi offer virtual cards for low or no cost. Traditional business credit card companies can charge hundreds of dollars in fees, plus more, for each employee card you request.
Even if you choose a credit card that charges an annual fee, setting up numerous virtual cards under one card means you only have to deal with a single fee.
Using virtual credit cards can help companies reduce the amount they spend.
Virtual cards allow your business to set individual spending limits by card and quickly track who is making purchases and what they’re buying. That makes it much easier to identify unnecessary spending and eliminate it.
Improved vendor relationships
Credit cards are one of the easiest ways to pay for the goods and services your company needs. If you want to work with a new vendor, giving them credit card details is a straightforward way to handle payments and assures the vendor they’ll get paid on time instead of waiting for paper checks to arrive in the mail.
More accessible payment systems can lead to a better relationship with vendors, and promptly paying invoices may even help you secure discounts.
One of the top reasons to use business credit cards is to earn rewards. Many cards offer perks like cash back, rewards points, or miles that you can use to subsidize your next flight.
Virtual cards can offer many of the same perks. For example, dash.fi provides 3% cash back on your first two months of spending.
Less paperwork for reconciliation
With individual virtual cards for each employee, department, or type of spending, you can save your finance team considerable effort and paperwork when reconciling your company’s expenses.
Virtual cards make it easy to see who made the payment and where the money went. You can even use apps to sync your virtual card statements with your company’s general ledger to streamline your processes.
If you wish to make a one-time purchase from a company and don’t plan to have a long-term vendor relationship, you can set up a single-use corporate credit card. This solution protects your card information and ensures that the vendor doesn’t accidentally charge the card again in the future.
What to look for in the best business virtual credit cards
If you’re in the market for a virtual business credit card, there are a few things you should look for to find the best of the best.
How many cards you can create
Virtual credit cards are great for many reasons, but if you’re only allowed to create two or three, that significantly limits their utility. You want to find a card issuer that lets you make as many virtual card numbers as possible, giving you the flexibility to use the cards the way that works best for your business.
While some card issuers limit how many virtual cards you can set up, dash.fi offers unlimited virtual cards.
Ease of use
You want your business's virtual card to be as easy to use as possible. A virtual card saves you the hassle of replacing card numbers in the event of a data breach. If you’re wrestling with a poorly designed website every time you want to set up or make a change to a virtual card, you’re not making your life any easier.
Look for a virtual card with a simple website or mobile app that makes managing your virtual cards as painless as possible.
Many businesses rely on apps and business tools to manage their bookkeeping, accept payments, or handle vendor payments. Choosing a virtual card that integrates with the tools you already use can make adding the cards to your existing processes easy.
Virtual cards are a powerful tool for business spend management. If you plan to use the cards to manage your employee spending or help ensure that departments stay within their budget, look for a virtual card with tools that let you customize the spending ability of those cards.
Keep in mind that virtual credit cards are a financial tool. Regarding your business finances, you must ensure you’re working with a legitimate company with a strong reputation.
The last thing you want to deal with is a shady virtual card provider that may open your company up to fraud.
Business virtual cards are an excellent tool for financial management and security. With dash.fi, you can create and use unlimited virtual cards for your team to help you achieve any business goal. To learn more and get started, sign up for dash.fi today.