Credit card fraud is at nearly $200 billion industry annually. And in a climate when 80% of businesses fail in the first 18 months, you need to do everything you can to reduce the risk of fraud. Not only can fraud be expensive to mitigate, but the time required to review statements and contest charges takes away from the time you could be using in your business instead.
Fraud can happen in a variety of ways: suppliers who don’t protect your payment information can inadvertently pass your information along to fraudsters; employees at your company or at a supplier can steal the information; or third-parties can intercept the information as it’s being transferred from one party to another. Whichever way fraud happens, it can be a costly part of doing business, and you would be wise to focus on minimizing the risk.
Furthermore, at a time when employee wages and benefits are always on the rise, employee efficiency needs to be top of mind for businesses trying to improve the bottom line. Virtual cards can help minimize the chance of fraudulent charges on your accounts while serving to streamline paying suppliers, make employees more efficient, and improve your bottom line.
What are Virtual Cards?
Virtual Cards are “credit cards” generated for one-time use by an issuer, such as MasterCard, or other various banks and financial institutions. These cards are virtual in the sense that they don’t issue a traditional plastic card to you. In comparison to traditional cards, virtual credit cards have many advantages:
Since the cards are virtual, they don’t need to be printed and shipped to you, so you can request a virtual card and have it issued immediately. You don’t need to wait to have it shipped to you, and you can use it immediately.
The card is a single-use credit card number, eliminating the possibility of fraud from suppliers, supplier employees, or third-party sources. Once the card is used, the number is invalid for additional use.
Virtual cards integrate with your ERP (Enterprise Resource Planning) or accounting software for recordkeeping, expenses, and tax purposes. The cards are still tied to your account, so you don’t need to manage multiple accounts.
Many virtual card programs offer the same miles, credits, and dollar reward programs that traditional cards do. Make sure you find out if your program offers them, and to sign up for rewards.
Some virtual card programs can issue numbers in bulk for volume transactions, or do it automatically for recurring payments or regular purchases. Check with your issuer to see if their virtual card system offers these options.
Virtual credit cards can help to improve efficiency, reduce fraud, and integrate with your payment systems to help streamline payment for suppliers. Check your credit card issuer’s website to see if they offer virtual cards, or give them a call!
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