Virtual credit cards or e-payments have become one of the most common payment methods. Suppliers and buyers can immensely benefit from this payment platform. It is regarded as one of the most convenient and efficient methods for paying invoices. This is the main reason why it has become a great payment option for buyers, suppliers, and business people.
What are e-Payments or Virtual Cards
Virtual credit cards are unique 16-digits numbers generated by computers to settle specific vendor payment transactions. They are mainly used to settle specific dollar amounts. Findings show that virtual cards are more secure than cheque and traditional ACH payments. In essence, these are “card-less” forms of credit cards. These cards can be processed by vendors who accept the conventional credit card payments. Outlined here below are the primary benefits that vendors can get by using virtual credit card payments:
Control and Security
Findings show that many companies are victims of fraud payment. The most common targeted payment methods include wires, credit/debit cards, and checks. Unlike ACH and check payments, suppliers and vendors using virtual card payments do not have to expose or share their bank account information.
The numbers used in virtual cards are created randomly for a specific amount and transaction, thereby eliminating the need for physical credit cards. Generally, virtual cards are limited to a specified time limit and amount, rendering potential threats as useless.
Better Transaction Detail
The other types of e-payments, including wire transfers and ACH, do not have the space for remittance information. For instance, wire transfer is limited to 140 characters, whereas ACH provides 80 characters. Virtual payment cards do not have space limitations. This means that vendors can customize their remittance information and thus eliminate manual reconciliation. Speeding up the transaction process makes virtual credit cards one of the best forms of payment.
Reduced Exception Processing
Virtual credit cards have a limited time frame, and they are also tied to specific amounts. This means that the vendor’s account cannot be used to process payments that are either lower or higher than the pre-set amounts. Exercising financial control can help you eliminate the possibility of overpayment o short payment. This is another benefit of reducing costly exceptions and time-consuming processing. It is, therefore, an attractive, excellent option for institutions that would like to use electronic methods to pay their invoices.