Using virtual credit cards for business has become an easy and convenient way of discharging obligations even when your vendors and clients are in far-off locations. This is, of course, if you often do your shopping online.
Confusion creeps in some time in the process simply because most business owners don’t know how virtual credit cards work. Therefore, points of confusion include poor handling of payment information, slow authorization process, and at times, complications associated with refunds.
In this post, you’ll find some tips to help you avoid those pitfalls and use your virtual credit card (VCC) the right way.
What Is Virtual Card Payment?
You may want to ask, ‘What is virtual card payment?’ The answer is simple. Payment via the VCC method allows small businesses to process payments over the internet without a physical card.
While serving as an electronic substitute for physical credit cards, a VCC number has all the required information. It includes the cardholder’s name, expiry date, and security code. It works like an actual credit card if you’re after reliability, usability, and other aspects.
Tips For Using Virtual Credit Cards
The beauty of a virtual card is its versatility. You can use it for business travel or purchases online or in-store, wherever you are. However, you need to know the terms before using a VCC. Here are seven tips to help you use it right:
Read The Fine Print
VCCs (also known as prepaid debit cards or gift cards) offer a convenient way to conduct business transactions over the internet. It usually comes with fine print. This will outline the rules and regulations of your card. Therefore, it’s essential to read through it to learn about the terms and conditions before signing up for one. That way, you’ll know what may happen with your money and whether there’ll be charges on extra fees or anything else unexpected.
Create An Account And Add It To Your Wallet
Create your virtual card in seconds. You need to sign up for a merchant account and add the virtual card link application to your mobile app. You’ll have the same features and benefits as a traditional credit card account: financial knowledge, fraud protection, detailed reporting tools, and mobile alerts. Choose from various credit cards based on your business needs and add them to your wallet for safekeeping. Moreover, ensure your wallet is password protected.
Organize Your Virtual Wallet
Before you start using a VCC for your business purchases, consider creating categories in your virtual wallet to organize your spending. This will help you keep track of your purchases and compare how much you spend each month on them. With this, you can decide whether to use the same categories every time or create new ones to meet your organization and reporting needs.
Keep Your Virtual Card Information Safe
Keeping track of all of your physical credit cards is hard work. You can combine all of your cards into one that never expires using a virtual card. The virtual card stays in your secure digital wallet that you can access from any computer or device. Thus, you don’t have to carry all your credit cards around with you.
Keep these things safe, though, so nobody steals your information or purchases anything on your account without your permission.
Sign Up For Alerts And Notifications
As a business owner, VCCs can be an excellent fraud prevention tool for your company. Allowing employees to make purchases with a card and automatically alerting you to new payment information helps you keep tabs on all business transactions better. Therefore, you should sign up for alerts if you haven’t. You can also adjust the way updates get to you and are given priority.
Track Your Spending
Whether you’re using your card for business or personal use, keep track of where all your money goes with the spending tracker. This tracker allows you to set spending limits for each of your cards and request for balance history. You can also set up reminders for every transaction to stay in control and get notified if there’s an unexpected change in spending.
Maximize The Use Of Your Virtual Card
There are several benefits to using a VCC for your business, so maximizing how you use it is never a bad idea.
For instance, having a universal virtual card clarifies the expenditure of your business. This changes how you do business, serving as a more efficient way to manage your employees’ expenses.
Other benefits of VCCs are freedom of spending, increased budget flexibility for businesses, reduced exposure to fraud, staff empowerment, improved accountability, and lower reconciliation costs.
VCCs simplify purchasing, prevent fraud, and help manage employee spending, but they’re not foolproof. A virtual card can’t guarantee complete fraud protection or keep employees from abusing expense account policies. Hence, before you start using any virtual cards, refer to the tips mentioned here to keep you informed of what you should know.