A virtual card is a digital representation of a credit card that is typically generated for a specific use, like paying a supplier invoice or purchase order. Virtual cards can be created instantly through a pre-approved process and are assigned to the specific amount of the payment or order they are tied to. Each virtual card has a unique number that ensures security and reduces risk. This allows employees to utilize a card payment in more scenarios while still encouraging adherence to their employer’s pre-approved spend policies.
vCards use a unique 15- or 16-digit virtual card number that is automatically generated, with payment authorized only for the designated supplier and a designated amount. This information, along with remittance detail, is emailed securely to the supplier. The supplier then submits the transaction. The transaction is then automatically reconciled with the associated purchase order once the payment is processed.
Despite the digital revolution in consumer payments, most companies in the United States still rely on checks and the Automated Clearing House (ACH) network to pay and be paid by their business partners. But there are clear signs of change.
In a 2022 Citizens Bank survey, 83% of corporate decision-makers at small and mid-sized businesses (SMBs) expect their company’s bank to provide the latest technological tools — with real-time payments functionality ranked as most important.
According to Juniper Research, the global value of vCard transactions will reach $6.8 trillion in 2026, from $1.9 trillion in 2021. B2B payments will continue to account for the majority of virtual cards transaction value, representing 71% of the total value in 2026.
The global real-time payments market is expected to reach $193.07 billion by 2030, says a 2022 report from Grand View Research, Inc.
Smart businesses — from large enterprises to SMBs — committed to technology innovation and capturing new value and agility are leading the way with vCard adoption. Larger firms are investing in payments innovation generally, with most already taking steps toward AP automation or planning to do so. SMBs, meanwhile, are taking advantage of the opportunity to adopt AP automation to get ahead of the competition and facilitate fast growth.