What is a Free Virtual Card?
Virtual Cards are a key component to not only securing each payment you make to your vendors, but also ensuring your cost to pay vendors is as low as possible. Virtual Cards (also known as tokenized payments) are a free, electronic payment method that allows you to earn rebates on every single payment made. Your business literally gets paid to make payments!
Let’s review how they work: Rather than using the card in your wallet, when you choose to pay via virtual card your vendor receives a 1-time use, randomly generated 16-digit number called a ‘token,’ which is algorithmically derived from your bank account information in a process called payment tokenization. This electronic ‘token’ can only be charged by your vendor once for the exact amount you specify—no more and no less. This means that you never have to give your bank account, or any other sensitive information, to your vendors and you can be confident that the charge will never differ from what you expected.
Let’s Talk Rebates
Typically, successful payments made via virtual card are eligible to earn a rebate. In some cases, you can even earn as much as 1% back on your payment. In times of economic crisis, businesses need to take advantage of every cost-saving or revenue-generating opportunity available. What could be better than continuing to make your payments as usual—but earning rebates at the same time?
What many AP professionals don’t realize is that many of their vendors already accept virtual card payments. Companies such as FedEx, UPS, and Comcast have been accepting virtual cards for some time. Are one of these 3 vendors on your list? How many of your other vendors are already accepting virtual card payments? And finally, how much money could you save your business by switching your payment method for just a few vendors?
COVID-19 and the Digital Payment Boom
Electronic payments used to be a nice-to-have, but with the widespread effects of COVID-19 and social distancing measures in place, they’ve quickly become a need-to-have. If paper checks weren’t already the slowest, most risky, and inefficient payment method available, (perhaps with the exception of a carrier pigeon) they definitely are now. Businesses that were reluctant to change their processes are now facing a harsh reality—optimize and automate payments, or you may be left behind. Businesses must also consider the health risks associated with employees breaking quarantine to handle invoices and payments. Electronic payments (especially virtual cards) ensure that you aren’t putting anyone at risk and are still able to pay the bills.
Take the Next Step
To learn more about how your business could earn rebates from virtual card spend, contact us.