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Automating Payables with Virtual Cards Streamlines the Payment Process

June 19, 2023
Aaron Whitely
Aaron Whitely

Like many organizations, you probably issue traditional purchasing cards to employees to make business purchases electronically. In doing so, you eliminate inefficient paper-based purchase order processes, gain financial float and earn rebates.

So how can you build on your card program success?

You could start an electronic payables program that offers the benefit of a virtual card solution. Virtual cards offer greater control, security, flexibility and efficiency in your purchasing and payment processes, which can help improve your bottom line and overall financial management.


Automate Payables with Virtual Cards


What’s a virtual card?

Virtual cards function very similarly to the traditional credit cards with which we are all familiar, except no physical plastic card is issued. A virtual card consists of a unique, single-use account number created for a specific transaction at a specific supplier. For security and simplicity, virtual cards are generated exclusively through an online automated payables system.

Companies of all sizes use virtual cards for a variety of payments, such as online purchases, vendor payments, and travel and entertainment expenses.

To enable the use of virtual card payments through Hancock Whitney, you establish a purchasing card program and implement our VenPay automated payables application. From there, the payables process is simple: You do a one-time upload of the information about each vendor you wish to pay regularly with a virtual card. You can easily update vendor information or add new vendors at any time. You make individual payments simply by uploading a file with just four data elements — vendor ID, invoice number, invoice date and dollar amount — and the payee receives an email providing the virtual card details and a description of what the payment is for. 


Security advantages

Payers can specify the exact amount of the transaction allowed to be charged to the card, and the expiration date can be set dynamically to minimize exposure.

Because virtual cards are generated for a specific transaction and have a limited lifespan, they are less vulnerable to fraud than traditional cards, which typically have extended expiration dates of months or years and can be used at any of millions of card-accepting establishments. In addition, you can set up virtual cards with specific spending limits and merchant categories to control spending and prevent unauthorized purchases.

An added element of security: With virtual cards, there is no physical card that can be stolen or compromised to make fraudulent purchases at a physical point-of-sale terminal. 


Other major benefits

Virtual cards enable you to easily track and reconcile payments. Because payments are tied to a specific transaction, they can be more easily matched with corresponding invoices and purchase orders, streamlining the accounts payable process and reducing errors.

Because virtual card payments are electronic and executed completely online, they are also processed much faster than traditional paper-based payments, allowing you to pay vendors and suppliers more promptly and potentially take advantage of early payment discounts when you choose.

And, like traditional purchasing cards, virtual cards offer up to 55 days of financial float, allowing you to delay payment until a later date, while still taking advantage of prompt payment discounts or other incentives. This can help improve cash flow and reduce the need for short-term financing.

While traditional plastic purchasing cards can still be the more effective solution for certain types of transactions, virtual cards offer greater security and control, as well as enhanced data and reporting capabilities that enable you to better manage expenses.


We’ll help you get started

If greater control, security, efficiency, financial float and speed for vendor payments sound like things that could benefit your organization, Hancock Whitney experts would welcome the opportunity to help you evaluate your payment volume, types and complexity, as well as security concerns and processing costs, to determine if virtual cards are right for your business. Should you find they are, we can provide program setup services, card issuance and integration with accounting systems.

We support you every step of the way. Once the program is up and running, we can offer detailed reporting and analytics on all transactions, allowing you to track spending, identify trends and make more informed financial decisions.

Many organizations have found that implementing a virtual card program is an easier-than-expected process that very quickly reaps real and sustainable benefits. In one instance, an industrial construction company in Louisiana recently moved its purchasing card program to Hancock Whitney and added virtual cards for vendor payments. Using Hancock Whitney supplier enablement strategies, including the VISA supplier matching service that helps identify suppliers the company is using that currently accept card payments, we helped the business quickly ramp up its electronic payables program to $39 million in annual virtual card spend volume, representing 40% of its total payables.

In addition to benefiting from the enhanced control, process efficiencies, payment speed and extended financial float, a significant portion of the company’s payables volume is now earning rebates for the first time.

To learn more about virtual cards and establishing an automated payables program, contact us at 1-866-594-2304.

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