How to Save Money Using Virtual Credit Cards with Your Accounts Payable Automation
Every business is familiar with the need to find ways of saving money. Accounts payable is one of the clearest focuses for that need since this is the department that governs funds leaving the company to cover expenses.
One of the most popular ways of saving money in recent years has been to switch to an automated and/or electronic processing system. The more you can automate, the faster and more cost-effective your process becomes. You’ll save money on labor costs, avoid late processing fees, and in some cases have the option to take advantage of early-pay discounts.
The money-saving benefits don’t have to stop at automation, however. There are also other programs and features that, when used alongside automation, can save your company even more money when you’re paying the bills. One of these is the use of virtual credit cards. In this article, we’ll be looking at what virtual credit cards are and how they can help save your company money.
What are Virtual Cards?
Virtual cards help companies streamline payment processes, save money, and generate additional revenue. They function like credit cards but, unlike traditional purchasing cards, these numbers are one-time-use. This provides additional security for your payments. Virtual cards also provide monthly rebates, so using them in your company can help generate revenue in the accounts payable department.
Virtual cards must be set up with your supplier to use them. Bank cards (one of the alternatives to virtual cards) leave this set up process to you. If you’re using virtual cards through NextProcess, though, we handle vendor enrollment for you. We’ll reach out to suppliers on your company’s behalf and work out an agreement. This may even include negotiating lower rates.
Automating for Efficient AP
You can start use virtual cards with your existing solution for accounts payable processing. However, that assumes you already have an AP process that’s working well for your company.
If you haven’t yet automated accounts payable, that’s one of the best things you can do for your company. You don’t have to be one of the the companies that’s still struggling with paper-based departments, or with partially automated AP, or with automation that is outdated and difficult to use.
It’s easy to bring your accounts payable department up-to-speed with modern AP automation. If you don’t yet have an automated accounts payable system, check out these articles to help you get started:
- 10 Compelling Reasons To Automate Accounts Payable
- How To Get Started with New AP Automation
- Your Essential Guide To Implementing Paperless Accounts Payable
Virtual Cards and Your Accounts Payable
Virtual credit cards make it easy for your company to switch over to electronic payments. It’s very much like using a check, only it’s better for your company. These cards are much more secure and help save money (more on that in a moment). Here’s how this process works if you’re using virtual credit cards through NextProcess in your AP department.
- Step 1: Your company approves an invoice and you make a payment from your accounting system just like you’re already doing.
- Step 2: NextProcess creates a single-use virtual credit card account number for the specific dollar amount of each invoice with detailed remittance information.
- Step 3: Your supplier receives and processes the payment.
- Step 4: We provide you with a file of all transaction information for automated reconciliation within your AP processing system.
- Step 5: You save money and turn your payables into a revenue generator by earning monthly rebates using the virtual credit card system.
How it Saves Money
One of the main reasons to use virtual credit cards is that you’ll save money. First of all, you save money by paying electronically. If you’re using paper invoices and checks, the average cost per transaction is about $31. With virtual credit cards the average cost drops to $9. This results in huge cost savings compared to traditional payment methods.
Virtual cards also earn your company money, which makes them better than other epayment methods. Because NextProcess delivers virtual card payments through MasterCard’s network, your company earns monthly rebates similar to the way an individual can earn cashback on credit cards.
Indirectly, you’ll also save money by fighting fraud, tightening security, and reducing errors. It’s easy for both honest mistakes and intentional fraud to creep in when you’re using a paper-based payment system. Automation drastically reduces the risk or errors and helps catch fraud. Plus, the single-use number that our virtual credit card system generates for each invoice tightens security and makes it even more difficult for fraudsters to steal money from your company.
Setting Up Virtual Cards in Your Company
One of the great things about virtual cards is that you can start using them almost immediately. We’ll handle the implementation for you and we’ll do it quickly. NextProcess has one of the highest implementation rates in the business processing automation industry. You don’t have to worry that our customer service will fail to deliver. This speedy setup procedure means you’ll get to take advantage of the cost-saving benefits as soon as possible.
Part of this setup includes handling vendor enrollment for you. We’ll take care of contacting vendors and gathering information on where card payments should go. This isn’t just part of the initial setup either – we include this service for the life of your program. We’ll also work with vendors who only accept credit card payments over the phone as well as those that accept payments online.
NextProcess offers the only suite of software with modules to power and to simplify your capital project management, procurement & purchase orders, accounts payable, travel & expense, and payment disbursements. You can keep using all our programs and seamlessly integrate virtual credit cards to further improve your accounts payable system.
Want to learn more about how much accounts payable automation and virtual credit cards can do for you? Click here to contact our team here at NextProcess.