With more economies moving towards cashless, your wallet is becoming the storehouse of plastic money. Stacking cards instead of physical money may seem convenient and safe but, this notion is way far from reality. Online frauds, lack of privacy, additional charges, loss, and misuse of cards are a few points you ponder on while transacting.
The introduction of virtual cards is a vital step forward towards a cashless economy by eliminating the cons of plastic money. Virtual payment cards are debit and credit cards that don’t exist physically. These are pseudo card numbers for carrying out online transactions through apps and websites. Each virtual card is a unique set of 16 digits and a security number that makes a cashless exchange between the payer and the payee. The best part of virtual cards is they can work similarly to regular credit and debit cards. Instead of entering your credit card number, during online payment, you enter the virtual payment card number and proceed as usual.
From a B2B transaction to just a mere online shopping, virtual payment cards are becoming a popular mode of payment. According to a foreign-exchange article, virtual cards have accounted for about one-third of all card payments in 2018 valuing around $170 billion. Over time the number will grow by more than $350 billion by 2022. Another research shows that the business use of cards will increase by about 90%, taking it to a $1 trillion mark by 2022. This tremendous growth rate is the result of all the added benefits of virtual payment cards that make it a viable choice by users. Here are five reasons which can drive you to switch from conventional cards to virtual.
Using traditional payment options like checks or cards, for a transaction, means to expose the details to the other party. With a virtual card, the details are never revealed. A virtual card comes with random one-time use numbers valid for a certain period say, 24 to 48 hrs. This payment card also has an exact payment amount and a maximum credit limit for each payment.
As there is no physical card available, the transactions are safe. Even if the card number is revealed accidentally, without the specific amount or transaction outside the duration, the virtual card becomes useless. Thus, the risk of theft and fraud is reduced to the maximum extent, making this mode of payment the safest.
2. Reduces business Cost
Any business involves some operating costs during transactions. In the conventional method of payment, say transacting through checks, maintaining a check stock, envelopes, and postage stamps incur a considerable amount of cost, in the long run. Additional costs like labor cost for dispensing checks are also involved. With virtual cards all these additional costs are saved.
Also, with businesses that involve overseas transactions, virtual cards can almost eliminate the overseas fees. Cross border payments require operational costs like cross currency markup charge, forex fluctuations, and cross-currency transaction fees. Virtual cards can avoid all such costs as well as the risk involved in overseas transactions.
While transacting, virtual payment can thus, reduce the overall business cost by saving the operational costs.
3. Control over money
Virtual payments give you complete authority with the specific transaction amount and expiration date. This gives you more control over your money and prevents it from fraud. For every kind of business, a virtual card can save additional paperwork for accounts management. Easy reconciliation through comprehensive remittance information also improves the internal transparency. Thus, virtual cards can improve the overall internal control.
4. Exciting cash-backs
A virtual card helps you to make numerous payments. From shopping to paying bills to bookings, you can use your virtual payment card for every small to big transaction. Just like plastic cards, you get cash backs in virtual cards. The simple rule is, the more payments you make, the higher the cash rebates you get. The best part is unlike cards that acquire points, virtual cards can get you actual money.
5. Better cash management
Immediate availability for transactions, payment automation, getting real-time rebates, instant application, and blocking of virtual card facilitates better cash management. Apart from this with any organization, virtual cards can enhance data capture and cut the costs of several resources used in the accounts payable department. Therefore, virtual cards can improve efficiency in the accounting process and manage cash in a better way.
In this fast financial world, the expeditious movement of money is the game-changer. Traditional transaction methods are history and physical cards will soon be out of fashion. With more savings, streamline operations, and effective security features, virtual cards will soon grab the financial market. These card numbers can become a critical tool for managing your cash efficiently with added facilities of generating revenues. So, next time you shop, pay your bills, or travel to your favorite destinations, use a virtual payment card for that hassle-free, time-saving and safe transaction.