Danish FinTech Cardlay is working with Visa to improve spend management for commercial card issuers.
The partnership, announced Wednesday (Oct. 2), combines Cardlay’s spend management platform with Visa’s market position, payment network and data capabilities to offer clients “fully embedded” commercial cards and expense management solutions.
“The commercial card landscape is rapidly evolving, driven by growing demand for digital solutions, contactless payments, digital wallet integration, and embedded finance,” the companies said in a news release.
“Virtual credit card payments are at the forefront of this transformation, redefining how businesses interact with payment cards and managing spend. Paving the way for a more seamless inclusive financial ecosystem.”
Research by PYMNTS Intelligence has projected that the global value of virtual card transactions will grow from about $2 trillion to $6.8 trillion by 2026, a sign of the growing recognition of their simplicity and security when compared to outdated methods such as paper checks. The research also showed that 55% of companies were using virtual cards more frequently.
And virtual card adoption, as determined in a separate PYMNTS report, can bolster financial results, while businesses that aren’t using these cards suffer average revenue losses of 4.6% due to payment uncertainties.
“We think virtual cards are really at a tipping point,” Previse founder and CEO Paul Christensen said in an interview with PYMNTS, estimating that virtual cards are used to settle just 2% of accounts payable transactions.
Adjust the needle only slightly, even a percentage point or two, and that means hundreds of billions of dollars in business-to-business (B2B) spending could become more efficient in terms of cash flow visibility, transparency and certainty.
“There are trillions of dollars that are going to move to virtual cards in the next two, three, four, five years,” Christensen added.
In related news, Bank of America on Tuesday announced the expansion of its virtual card offering in Europe, the Middle East and Africa (EMEA) with the debut of Virtual Payables Direct.
“Virtual Payables Direct offers our clients in EMEA greater flexibility as they can make card payments to any supplier in the region, regardless of whether the supplier typically accepts card payments,” Chris Jameson, head of product management for global payments solutions EMEA, said in a news release. “The payments are made much earlier in the procurement cycle, thereby helping to improve important supplier relationships and allowing the buyer to take advantage of any prompt payment discounts.”
