As the role of the travel manager continues to evolve, technology stands to play a major part. Virtual payments is one emerging technology that is already starting to have a big impact on the travel industry. As travel managers struggle to meet their program objectives while still delivering a positive traveler experience, virtual payments is one technology that is uniquely positioned to do both by simplifying the experience for travelers while giving travel managers more visibility and controls.
With a growing number of travel managers starting to experiment and adopt this new technology, it stands to see tremendous growth over the next few years. According to the new Travel Manager 2020 report produced by GBTA and Sabre, “66% of travel managers expect alternative forms of payment technology to become a higher priority in the next 3-5 years (23% stay the same, 11% less of a priority).” It was rated as the third priority behind only mobile, and traveler safety and security. Also according to the study, the expected priority for implementing virtual payment technology increases to 77% for those travel managers that report into Finance.
Revolution in payment technology
So what makes virtual payments such a hot topic? They are a revolution in payment technology and are helping to reduce the cost and complexity associated with a corporate payment program. Virtual cards function in the same manner as traditional credit cards, but with additional capabilities for improving compliance, control, security, and automating the reconciliation process. While traditional cards have a fixed number, virtual cards have a unique electronically obtained number (with expiration date and CCV) and are issued for a specific travel event. Once a virtual card is issued, payment restrictions ensure that the number can only be used for a specified amount and within a specified date range. After the number has been used, it is no longer available to be charged and the transaction and booking data is automatically reconciled.
How can virtual cards help you?
Save time with automated reconciliation
- Virtual cards have characteristics that allow the reconciliation process to be more automated than physical forms of payments like corporate cards, which can eliminate the manual effort required to match transaction and booking data.
- Administration costs are cut as the time it takes to complete the reconciliation process is reduced and more timely payments can be made to preferred suppliers.
Make compliance easy
- A virtual card is deployed during the reservation process and sends payment instructions and restrictions to the travel supplier.
- Ensure preferred suppliers are used and components of the travel policy are enforced fairly throughout the company.
Say bye-bye to risky travel
- Improve security by replacing plastic cards with virtual cards that have custom controls designed to optimize traveler security.
- A plastic credit card is at risk of being lost or stolen or, if your employee still has their card, the number can be recorded and misused by other parties.
- Fraud is almost impossible with virtual cards because each number is unique, assigned to a specific travel event, limited to approved locations, and only for the amount pre-approved.
Gain a universal payment solution
- Virtual cards are accepted in any country where plastic cards are accepted, by millions of service providers and suppliers across a wide range of currencies.
- There are no new processes for virtual cards, and suppliers will experience faster receipt of payments. The impacts on their cash flow can be significant.
The future is today
There are many compelling reasons to use virtual card technology. Virtual cards are becoming the new standard in corporate payments and, as stated in a recent interview between Phocuswright and MasterCard, will eventually remove the need to carry cards in your wallet.
Travel Manager 2020 Research Report
Sabre recently partnered with the GBTA Research Foundation to better understand the key trends and forces impacting the travel industry. The result? Groundbreaking research that takes the most comprehensive look to date at the areas impacting the role of the travel manager today and in the future.
To help you stay one step ahead of the technology evolution, we’ve created a dedicated microsite for everything you need to grow strategic influence within your organization, including information on the emerging area of virtual payments. You’ll get exclusive access to the formal research report as well as valuable information on the three key areas impacting corporate travel – data, payments and mobile.
Check back each week as we continue to post new content on these three timely topics.