How Virtual Cards Help Overcome the Challenges of Remote Work

Between modern technology and COVID-19, the way we work has changed significantly in the last few years. With many teams switching to permanent remote work or hybrid models, businesses have had to adjust many aspects of their day-to-day operations.

Gone are the days of sharing physical credit cards to cover office expenses like software, equipment, supplies, and refreshments for meetings. And with fewer employees sharing space with their colleagues, business expense management has changed too.

Luckily, virtual cards have emerged as a practical alternative to traditional corporate cards, expense reports, and reimbursements. Let’s explore some of the ways that virtual cards can help your team stay on budget, save money, and overcome the challenges of remote work.

What Are the Challenges of Remote Work?

When it comes to business expense management, remote work poses some unique challenges. Here are a few examples of the issues it can introduce.

The Decline of Card Sharing

Until recently, it was a common practice to share the same corporate credit card among multiple team members. This allowed employees who shared the same budget to buy what they needed, without having a designated person to make purchases for them. But if people are no longer working in the same physical space, it becomes impossible to pass a credit card back and forth.

Work-From-Home Budgets

Remote employees are often allocated a work-from-home budget to buy equipment such as a desk, chair, and computer—the resources that would be included in a typical office setting. This gives them control over the items’ size, style, and delivery schedule, rather than the company simply selecting and buying equipment for them.

Additional Onsite Events

Onsite meetings, team building, and social activities take on special importance when employees aren’t together in the office on a regular basis. But remote-first companies may not have the space or supplies to host these events. In-person gatherings require extra spending on things like venue rental and refreshments, and often different people are in charge of each expense.

How Do Virtual Corporate Cards Work?

Virtual cards can be issued to individual employees or departments, empowering them to make purchases with company funds. They can be used online, saved in a digital wallet, or paired with a physical Plug & Pay card. They have all the information needed to make payments, plus the option to customize amounts, vendors, and expiration dates.

For example, if an employee needs a new pair of headphones, a manager can issue them a virtual card with a specific spending limit. If they try to spend more, the card will be declined. It’s also possible to lock the card to a preferred vendor, and to create an expiration date so that they company funds aren’t left in limbo for a long time.

Tips for Using Virtual Cards for Remote Employees

Before implementing virtual cards, consider these tips to ensure that best practices are being followed.

1. Establish and Enforce an Expense Policy

Regardless of your corporate spending system, every company should have an expense policy in place. Choose a virtual card provider that can automatically incorporate and enforce your expense policy. Purchases that don’t align with approved amounts or vendors will be automatically declined, and you can then investigate the situation.

2. Lock Virtual Cards to Vendors

For recurring expenses like SaaS subscriptions, create a virtual card that’s locked to a single vendor. You can rest assured that the card won’t be used for any other expenses, and you’ll never have to worry about missing a monthly payment. This also makes it easy to identify any unusual changes or duplicate charges.

3. Embrace Flexibility With One-Time Use Cards

For occasional expenses like a celebratory lunch or replacing a desk chair, one-time use cards can be extremely useful. They can be preloaded with the budgeted amount, locked to a vendor, and set to expire within a short time frame. For example, you could give an employee a card to buy a birthday lunch, and set it to expire one week later.

4. Use Virtual Cards for Team Building

Virtual cards are a great tool for encouraging team building among remote employees. To make up for the lack of in-person social activities, you could assign a virtual card to each employee and match them with a colleague who they have to buy a meal or gift for. Virtual cards also make it much easier to organize and pay for occasional in-person events to encourage camaraderie and connection.

5. Get Cash Back

In addition to helping you control your corporate spending, virtual cards can also earn you extra money through cashback incentives. Keep this in mind when choosing a provider, and make sure to check the conditions and offers that your virtual cards will include so that you can take full advantage of them.

The Benefits of Virtual Corporate Cards

Providing virtual corporate cards for employees can increase efficiency, ensure security, and give finance teams better control over business spending. Let’s take a closer look at some of the biggest benefits of virtual cards.

Save Time

Virtual cards help you save time by eliminating the need to track down physical cards, exchange them between employees, and contact managers for purchase approvals. A virtual card request contains all the necessary information so that managers can immediately approve, alter, or deny requests as needed.

Virtual cards also save time for the finance department by automatically categorizing business purchases, recording transactions, and syncing receipts with the company’s ERP. They eliminate the need to manually update the status of outstanding payments and expenses, or to call customer service to cancel a card; all changes can be made online.

Increase Security and Control

Virtual cards remove the risk of misplacing a physical card—or worse, having it stolen—and help to prevent fraud. Even if a cybercriminal does gain access to sensitive details, pre-set restrictions will prevent them from racking up purchases. Virtual cards let you control who has access to company funds, as well as where, when, and how much they can spend.

To further ensure security, Mesh sends automatic notifications when card requests are made or when purchases need approval. The platform provides full visibility, making it easy to spot suspicious activity immediately—instead of waiting until the end of the month to discover fraudulent charges.

Enhance Expense Tracking and Management

Virtual cards include real-time tracking, which allows you to closely monitor spending patterns and reconcile expenses immediately. With traditional physical cards, employees can only be held accountable for unauthorized or unnecessary purchases after statements are published—sometimes several weeks later.

Virtual cards promise speed and transparency when it comes to managing expenses. Since the cards are created with specific purposes and restrictions, you can easily automate backend accounting aspects and create rules for automatically entering data into the general ledger.

Cut Costs

Apart from saving time, virtual cards can also help you save money. There’s no need to order plastic cards and then order new ones when employees inevitably lose them. Using virtual cards also lowers processing costs for buyers and suppliers, and allows businesses of all sizes to benefit from technical economies of scale.

Since virtual cards reduce the volume of clerical work, they may even allow you to save on labor costs. And just like traditional credit cards, they often have cashback and rewards programs that can help you offset the costs of doing business and increase your profit margin.

Foster Flexibility

Virtual cards offer an unparalleled level of flexibility. You can access the platform to modify card details, assignments, vendors, limits, and expiration dates whenever you want with just a few clicks. It’s easy for employees to add them to digital wallets and use them online or in person, and for employers to track and manage spending in real time.

Virtual cards also make it easier to manage expenses in multiple currencies, which is essential for international transactions. Payments can be made in the supplier’s local currency, and foreign exchange rate markups and cross-border fees can be avoided. The supplier can also avoid fees, fluctuations, and the hassle of exchanging currency.

Streamline Operations

The broadest benefit of virtual cards is how they allow you to streamline the entire expense management process. Setting up and modifying cards is quick and easy, and all reports and statements are available in seconds. It’s hard to imagine a more convenient way of managing employee expenses—especially since everything is updated in real time.

The best virtual cards include powerful automation capabilities, allowing companies to enjoy the advantages of automated approval workflows, categorizations, and data entry. In short, virtual cards are the payment method of the future—and considering the growing prevalence of remote work, it’s clear that they’re a perfect match.

To learn more about how Mesh Payments can help you manage your remote team and control corporate spending with virtual cards, schedule a demo.

FAQs

• Get the latest blogs from Mesh by subscribing to our newsletter