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If you’re a growing small or midsize business, you’ve probably been hearing a lot about “virtual payments” and their importance in the modern economy. For some of you, they may feel like intimidating technology—especially when resetting the WiFi router feels like getting a computer science degree.
Don’t worry. In reality, virtual payments are very easy to use, and once you’re set up, they actually provide your business with a number of benefits, including streamlining payments, and data clarity for both accounting and business analytics.
While there are many facets to virtual payments, today we’re going to be looking at virtual credit cards, and specifically, how they are used with one of the largest online payment processors, Stripe.
A virtual credit card is a set of 16 randomly assigned digits associated with an account. It’s just like with a normal credit card, except, you know, virtual. Because they are created for a specific user or instance, they are highly flexible in how they can be used. Almost all have predetermined spending limits and expiration dates (often limited to a single transaction).
As seen above, the primarily benefits of a virtual credit card are convenience, transparency, and security. Virtual credit cards can be ready instantly, can be turned off at any time, and don’t run the risk of being misused by a untrained employee. Virtual cards are growing quickly in popularity and are currently used by over a fourth of Fortune 100 companies.
If you haven’t yet used Stripe, they are a technology company known for their system of online payments processing. You can use whatever payments processor you prefer for virtual cards, we just chose Stripe as their reputation is strong specifically in this area.
To generate a virtual card with Stripe, all you need to do is install their API, and then set up a dashboard. For non-technical people, this is akin to installing a program—one that lets your network (the point of sale) talk with Stripe (the payments processor). That way Stripe can issue cards directly through any of the major card networks, but you only need to interact with Stripe.
Once you install the API set up your dashboard, virtual cards can be issued instantly through mobile wallets, such as Apple Pay and Google Pay. You can read a bit more technicals here.
Once you get set up with virtual credit cards, you may find yourself fascinated with how quick and comprehensive it is. After all, virtual payments provide instant purchase tracking behavior, and electronic permissions.
With all this capability, many companies have emerged to help customize and uplevel your virtual card capabilities. These are done through something known as “Custom API” which allows you to sync or share your virtual card data with whatever programs are most useful for your company. An example would be seamless accounting by connecting your purchase receipts with software like Quickbooks or Expensify. Customizing your API often also comes with more customizable dashboards, should you want a program or function for your company that’s very technical when done directly with Stripe.
The more involved you become with virtual payments and virtual cards, the more you may find yourself wanting to increase their efficiency and reach. If you’re a business, information literally translates to money, and so the more control and awareness you have both of cash inflow and spend, the better you can optimize your budget.
With that in mind, we strongly recommend you check out the benefits of virtual cards and digital payments processing to see how they can benefit your business. If the future of commerce is digital, don’t get left offline.