Commercial card programs continue to evolve as businesses shift spending from traditional corporate travel cards toward procurement-focused payment solutions. Purchasing cards and virtual cards have experienced significant growth as organizations seek greater control, improved security, and streamlined accounts payable processes. These changes reflect broader efforts to digitize B2B payments while reducing manual workflows and enhancing visibility into business spending.
The changing mix of commercial card usage has created new challenges and opportunities for card issuers. Companies with portfolios heavily concentrated in travel and entertainment (T&E) spending may experience greater volatility during periods of reduced business travel, while issuers with strong purchasing card and virtual card offerings are better positioned to benefit from ongoing growth in digital commercial payments.
One must keep in mind that the lion’s share of U.S. market growth in commercial cards during the past several years has been in purchasing cards and virtual cards, with the highest growth rate in virtual cards. You can find Mercator’s estimates for these two products in the recent Mercator Advisory Group research report titled, State of the Commercial Card Market 2015. Amex reports a 2% overall decline in the Global Commercial Services corporate card spend volumes year on year. The vast majority of Amex corporate card spend is in T&E, not procurement, making Amex more vulnerable to travel budget cutbacks. There may also be an industry segment targeting issue in Amex’s portfolio, since overall U.S. travel was expected to rise by 3.1%, as reported by the Global Business Travel Association. Amex does not break out regional growth within its GCS numbers, so it is hard to pinpoint if U.S.-based travel spend is the only weak point, or just the major one.
Why It Matters Today
Virtual cards have become one of the fastest-growing segments of the commercial payments market. Businesses increasingly use single-use and controlled virtual card numbers to improve security, automate invoice payments, and simplify supplier transactions. At the same time, purchasing cards continue to replace paper checks and manual procurement processes, supporting broader accounts payable automation initiatives.
For commercial card issuers, product diversification is increasingly important. Organizations that rely heavily on travel spending may experience fluctuations tied to economic conditions or changes in corporate travel policies. Expanding into procurement payments, embedded finance, and virtual card solutions helps issuers create more balanced commercial portfolios while addressing the evolving payment needs of business customers. As B2B payment modernization accelerates, virtual cards are expected to remain a major driver of commercial payments growth.
Key Takeaways
- Virtual cards continue to be one of the fastest-growing commercial payment products.
- Purchasing cards help businesses automate procurement and accounts payable processes.
- Heavy dependence on travel spending can expose commercial card portfolios to economic shifts.
- Diversified commercial payment offerings position issuers for stronger long-term growth.
The commercial payments landscape continues to shift toward digital procurement and automated payment solutions. While travel and entertainment spending remains an important part of corporate card programs, long-term growth is increasingly being driven by purchasing cards and virtual cards. Financial institutions that expand beyond traditional corporate card products and invest in modern B2B payment capabilities will be better equipped to meet changing business needs and capture future commercial payment opportunities.
Overview by Steve Murphy, Director, Commercial and Enterprise Payments Advisory Service at Mercator Advisory Group
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