Virtual cards operate like traditional credit cards, but without physical plastic.
Instead, they provide a unique, single-use account number for a specific transaction with a designated supplier. These cards are securely and conveniently generated through an online automated payables platform.
Organizations of all sizes are realizing the substantial benefits of virtual cards, including increased control, heightened security, greater flexibility and improved efficiency in their payment processes — all of which can positively impact the bottom line.
Here are the steps we recommend for considering an automated payables program with virtual cards as the centerpiece.
Assess the opportunity
Your payables system is crucial to businesses, so changes require thoughtful evaluation. Start by mapping out your current processes and pinpointing areas to streamline and optimize. Next, consider how integrating virtual cards could amplify these efficiencies.
Virtual card programs offer more than just rebate opportunities. Transitioning from paper to electronic payments increases efficiency and provides float benefits. Virtual cards also provide superior security compared to traditional paper payments. Consult with your bank’s treasury specialists to learn about these advantages and understand how to easily convert suppliers to card payments.
Gain internal support
Once your financial team identifies the benefits of a virtual card program, it’s crucial to secure buy-in from key stakeholders. Start by advocating to your executive leadership team, as their support is essential for largescale changes.
You’ll also need to address concerns from departments like procurement and accounts payable, which initially may be hesitant. Present the compelling case that emphasizes cost savings, increased security and other advantages, aligning these benefits with both the company’s overall goals and its individual department priorities and constraints.
Partner with your bank on supplier enablement
Getting suppliers to adopt a new payment method can be challenging, but your bank can assist.
For example, Hancock Whitney leverages the Visa supplier matching service to identify which suppliers already accept card payments — an ideal starting point for your first supplier enablement campaign.
Our team can support by reaching out to suppliers or demonstrating how virtual card payments can enhance cash flow and reduce operational costs.
Grow the program
Sustaining and growing virtual card usage requires ongoing effort.
If you frequently engage new suppliers, consider annual supplier enablement campaigns. Our experts can assist by educating new and resistant suppliers about the benefits of accepting virtual card payments.
One effective strategy to incentivize suppliers is to offer faster payment terms. For example, you might negotiate a deal to pay a supplier in 30 days instead of 45 if they agree to accept virtual cards.
Virtual cards are useful and versatile for various expense types like online purchases, vendor payments, and travel and entertainment expenses. Explore the opportunities offered by an electronic payables system with virtual cards.
For more information, visit hancockwhitney.com/payment-cardsolutions.
