Much of the growth in commercial cards will come from large and middle market (LMM) organizations. The larger corporates, businesses with revenues of $1 billion and upwards, were the earliest adopters of commercial cards. Dynamic middle market businesses are now increasingly also looking to move away from inefficient manual processes and make the switch to digital.

Why virtual cards are helping drive commercial card growth

Across both large and middle markets, however, there are a raft of drivers of the growing interest in commercial cards. These businesses often look for higher levels of automation and the more advanced technology they associate with commercial cards – from the ability to quickly analyze which suppliers they are spending most with to the ease of applying a payment to invoices.

The growing availability of virtual cards is fuelling growth in commercial cards. The ability to reduce fraud is probably the biggest driver. If a large or middle market business is using an automated clearing house (ACH), for example and their systems are compromised, they lay themselves open to additional fraud through the account numbers used on those transactions. The use of virtual cards and associated tokens effectively eliminates that risk. That’s because these cards are configured for a single one-time use only – and controls are placed on each card. If a fraudster compromises the existing system and gets access to the tokens, they cannot actually use them again because they will have been reset to zero.

The second key benefit is being able to use these cards for reconciliation. Even if a business has effectively used tens of thousands of these cards or tokens, they can always reconcile the unique account number perfectly with the relevant transaction. That removes the need to manually work out how many times the same account number has been tied to an existing payment.

The third key area where large and middle market businesses benefit from the use of virtual cards is their ability to take the approach and drive up its usage in today’s ‘mobile first’ millennial economy. Businesses can enable employees to take these types of accounts and drop them into their smartphone, before using the latest apps coming on stream or routing them to existing apps like Apple Pay.

Key focuses of growth – expanding applications and use cases

Today, we are seeing a growing range of use cases for virtual cards across large and middle market businesses. Take bill payments, for example. Here, we are seeing businesses making payments to both payment aggregators and corporates, based either on using commercial credit or a good fund model, where the funds exist before the payment is initiated. That process often makes use of a virtual card to ensure efficient reconciliation, support real-time payments and instant receipt of funds, as well as helping guarantee the security of the transaction.