Virtual cards are the next generation of payment tools used by both small and large businesses. Think of them as one-time use debit card, but no physical, plastic card in hand. Rather the guarantor will usually furnish you with items of a card record. This might include the card number, an electronic picture of the card, the expiry date and the security code, that you can then use to make purchase good or services.
A virtual card is perfect for transferring money from account to account and moving funds between providers via an electronic method utilizing a card network. Use it for any business-to-business payment where the payee is capable of processing credit or debit cards. This includes claim payments for group health, workers’ compensation, auto insurance and various other property and casualty payments.
Features and benefits of virtual cards include:
- Flexibility: they are designed to complement an organization’s existing commercial card or check issuing program, or be used as a standalone solution. Payments can be received via fax, email or other communication method.
- Ease of implementation – There are no set-up fees, no enrollment is required, no software to purchase or install, no special files to configure and no additional processes to implement. It also utilizes existing office technology.
- Security – to safeguard against misuse, virtual cards generate a unique number for each transaction. Authorization controls are set by the issuing organization to provide peace of mind that each transaction is tied to a specific number.
- Cost Reduction– Virtual cards eliminate all provider payment related print/mail costs, have no charge for transactions, regardless of method (VCard, Check, EFT) and do not charge for zero pays.
- Efficiency – information can be captured up front to provide enhanced reporting, reconciliation, and allocation. This includes automated, real-time matching of POs, merchant classification codes, merchant ID, invoices, TINs or EOBs with virtual card transactions. Payment and remittance are delivered together as a single file, so no matching is required
- Environmental Impact – Reduce the amount of paper used by your office and save millions of trees, reduce CO2 emissions and yet reduce costs at the same time. A win-win for all parties involved.
- Regulatory Compliant – HIPPA compliant, secure transactions used by thousands of doctors, hospitals and insurance companies worldwide.
Would you like to learn more? Our electronic funds transaction comparison chart will break down the features and benefits of EFTs, checks, virtual cards and ACH transactions.