We’ve seen it time and time again. Payments for goods or services in a company tend to follow a well-worn path. Here’s how it goes:
Well, that’s the idea anyway. In reality, the corporate payment process doesn’t always work out as expected.
It’s all too easy for the process to grind to a halt: if a supplier isn’t in the corporate database, for example, then they’ll need to be onboarded before the purchase order can be processed. That means time and energy, every time.
The push towards online isn’t helping things either. Employees are increasingly generating low-value, one-time corporate expenses from smaller, online suppliers who aren't in the company’s database.
Combine this with the move towards remote or hybrid working, you can start to see how optimizing the way you manage online purchases coming from all corners of your company is becoming a priority.
The worst offenders? Those tricky infrequent expenses with online suppliers where advance payments – often by credit card – are required to access the product or service. No one wants to cover these with their personal credit cards, especially knowing it may take a while before they get that hard-earned money back.
So let’s skip to the good news. There’s a way to ease this pain for both your company and your employees: AirPlus Virtual Cards Procurement. It’s our virtual payment solution designed for flexible employee usage, while providing central control and visibility.
By now you may be asking how control and flexibility can be combined in one payment solution. Let’s explore the details.
What do you think of when you hear “credit card”? Plastic, mag-strip, name embossed and some numbers, right?
How about virtual credit cards? No need for a physical card anymore – you get a card number, expiry date and security info and you’re ready to go. And they can be customized to only work for specific departments or suppliers, or even just for a one-time purchase. With AirPlus Virtual Cards Procurement, for example, you get company-based virtual credit cards that can be individualized for each employee based on their needs.
Your company is the cardholder and determines the settings that come with it. This means that you can customize restrictions for the use of the cards before providing them to the employee for payment. Restrictions include:
Also, your company can allocate specific budgets to specific departments, whether for marketing expenses or IT purchases. These departments then have the flexibility to use AirPlus Virtual Cards Procurement within a set budget, a certain period and with the selected suppliers. In short: No more maverick spend.
Let’s not forget that visibility and control are managed from a central point – at all times. And to make it even easier, every single transaction you make is combined by AirPlus into one single, easy-to-understand invoice, which is then billed to the company in one go at the end of your statement period. Your suppliers, however, receive payment from AirPlus immediately.
For optimal reconciliation with AirPlus Virtual Cards Procurement, details of the cost center, department code - or any other relevant billing information for recognizing the transaction - can be entered in the designated billing data fields linked to the card. Doing so makes matching your transaction with the respective purchase order a breeze.
Typically, every single purchase order is requested by the employee, approved by the manager, then passed on to the purchasing department. Which means that everyone from the accounting team to the treasury are involved to process the payment and keep track of the balance.
Remote working has been wreaking havoc on these traditional processes. Since the start of the pandemic, 62% of finance teams are either fully remote or hybrid working according to MineralTree's 6th Annual State of AP Report.[2] Before the pandemic that was only around 15%.[2] Therefore, a switch to digital payment processes is needed to stay connected.
With AirPlus Virtual Cards Procurement, you are taking steps in this direction by speeding up the payment process while still maintaining an overview of spending and saving on days payable outstanding (DPO).
There are a few more benefits to using AirPlus Virtual Cards Procurement as a virtual corporate payment solution too:
Using AirPlus Virtual Cards Procurement for your procurement process certainly has its strengths, but it’s worth mentioning that you don’t need to completely replace bank transfer payments for all your corporate purchases. For your regular, contracted supplier purchases that see company-wide roll-out, payments by bank transfer may still fit best for your needs.
AirPlus Virtual Cards Procurement fulfill a useful purpose – those infrequent, one-off or subscription-based purchases with online and often smaller suppliers that are not in the corporate supplier database of your company.
They are also tailored for those purchases that are not handled centrally but by employees directly. This will come in handy as the remote or hybrid work trend seems to be here to stay, and so it’s not likely we’ll be seeing a return to entirely centralized processes any time soon.
Thanks to AirPlus Virtual Cards Procurement, you can stay on track with corporate spend while meeting the needs of your employees and other stakeholders in your procure-to-pay process.