The travel and expense reimbursement process is a common pain point for many organizations—an issue American Express and Emburse aim to solve with virtual cards.
Within Emburse’s expense management platform, Amex is introducing virtual card issuance capabilities, coupled with real-time transaction data that give organizations visibility into card activity.
For example, a customer could issue an Amex virtual card for a business trip. Once issued, expense entries would automatically be created, and the organization would receive card live updates on card spending as they occur.
Self-Evident Applications
Many industries are only now realizing the benefits of using virtual cards for enterprise payments. Each virtual card is issued with a unique card number, expiration date, and security code—details that not only protect sensitive data, but can be leveraged for reporting.
The advantages of virtual cards in travel and expense management are clear, especially compared with the traditional process where employees pay out of pocket and later submit receipts for reimbursement.
Beyond that, virtual cards also offer distinct benefits over company-issued physical cards. They are far less likely to be lost or stolen, and organizations can set precise spending controls. These may include transaction limits or restrictions that confine a virtual card’s use to specific vendors or sectors.
Furthering the Use Case
While travel expenses are a common use case for commercial virtual cards, their potential extends much further. In fact, virtual cards are often much more efficient for any employee-initiated purchase. This allows employees to make indirect yet essential purchases, including maintenance items or event supplies, without having to go through the purchase order process.
While the benefits of virtual cards are significant, many companies remain unsure about how to deploy them effectively.
“It’s only good to be used to make payment to that one supplier, conceivably on that day,” Hugh Thomas, Lead Commercial and Enterprise Payments Analyst at Javelin Strategy & Research told PaymentsJournal. “It’s got all the benefits of a card wrapped on top of it, the recourse to charge back if you don’t get what you said you were ordering, and so forth.”
“Now you have a solution that has a bunch of benefits to it, but also a bunch of costs to it where you need to be conscious of where the thing is best applied—and that is not something that’s immediately intuitive,” he said.
