virtual account numbers. The bank has also introduced an email reminder service to notify suppliers if they have not processed a payment generated for them using a virtual card account.
DEATH TO PLASTIC?
Given all these virtues being ascribed to virtual cards, does this mean that the humble plastic corporate cards currently being handed out to travellers are likely to be to phased out? Not in the near future, according to those in the know. Visa Europe’s head of commercial
large- and mid-markets, David Harrison, says that the issuing of physical corporate cards has “accelerated” over the last year, which he adds may be down to improved confidence within companies about the need to travel more frequently, and also the successful use of expense manage- ment systems (EMS). “Companies are feeling more confi- dent and comfortable about issuing cards because everybody is happy using the EMS,” he says. “They can say to employ- ees that they need to use the corporate card and don’t use your personal cards. They give them the corporate cards and the management solution provides the information.” Harrison says virtual cards are more likely to be used by “infrequent” travellers who do not make enough trips to justify their own personal corporate card. “You need to offer good, all-embracing solutions to cover all the eventualities,” he adds. “Different markets have different levels of awareness and adoption of the various payment options, so you have to offer a choice.” BAML’s Gargagliano agrees that tra- ditional corporate and lodge cards “still have a place” in the payment landscape because they “solve real problems that companies and business travellers face”. But she adds: “Companies are beginning to embrace the benefits offered by virtual cards over traditional corporate cards, as they address a number of gaps prevalent in other commercial payment solutions.” Even a virtual card evangelist such as Conferma doesn’t think corporate plastic will disappear in the next few years. “In the short term it is unlikely virtual cards will replace corporate cards; however, in the medium term we see the benefits
In association with
“Volumes of virtual card adoption have doubled year-on-year from 2013”
and popularity of mobile technology and virtual card technology combining to make traditional corporate cards redundant,” says Conferma’s Birkett. American Express’s Gillies believes that client demand is currently higher for virtual payment solutions than for more high-profile developments such as con-
tactless payment through smartphones. “Virtual payments address the strategic financial priorities of the business, such as control, reconciliation and data,” says Gillies. “Our V Payment solution has real traction in the online travel agent and meetings spaces: a number of our clients are using virtual card numbers for their meetings and events spend, especially for group travel.” Citi is also seeing “an increased level of
client interest and demand for virtual cards for meetings and events”. Lauren Millar adds that overall virtual card adoption is increasing each year: “Volumes have doubled year-on-year from 2013,” she says. So while there seems little doubt that virtual cards are going to increase in terms of volume and corporate use, it is also somewhat premature to imagine a day in the near future when regular road warriors no longer carry around a little piece of plastic to pay for their travel purchases.
CASE STUDY EDF Energy embeds virtual accounts
ELECTRICITY AND GAS SUPPLIER EDF ENERGY wanted to change the frag- mented way its employees paid for travel and create a consolidated and stream- lined system. The company, which has 15,000 workers in the UK, spends around £15 million annually on travel. EDF previously relied
on a system based around central booking, with a lodge card in place for buying flights. But this was not designed to book low- cost airlines, which need a card verification value (CVV) security number to complete a sale. This led to employees booking these flights with individual corporate cards or personal cards – both of which meant that EDF’s self-booking tool was not being used. The company was also struggling to know
how much it was spending on travel.
Robert Gilhooly, EDF’s financial shared services director, says: “We wanted our online booking tool to be as seamless as possible for our employees.” The company turned to American Express Global Corporate Payments to help find a solution and the card provider used virtual card technology to create a bespoke product, now known as V Payment Traveller. Under this system, every traveller has a virtual account lodged behind their profile on the EDF online booking tool, which is synchronised with the traveller’s profile held by the company’s TMC. When the employee books travel, this account number is securely and automatically passed to
the travel supplier without the staff member having to supply it. This works for both traditional and low- cost airlines as the CVV number is embedded into each account.
The system also works
for hotel bookings by email- ing properties to tell them what additional charges are included, such as meal al- lowances, so that travellers do not have to produce a card when checking in. “We are now able to
deliver a vast amount of account numbers – unique to individual employees – to our online booking tool,” says Gilhooly. V Payment Traveller means that EDF can now see individual travellers’ transactions, raise compli- ance levels and increase the use of preferred suppliers.
BBT CORPORATE CARDS SUPPLEMENT 2015 17
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36