How virtual payment solutions have transformed business travel programs
From reservations and check-ins, to payments and customer service, technology has fundamentally changed how we travel by creating a smoother, quicker experience from beginning to end. When it comes to corporate travel, technology has transformed processes that were largely manual and outdated, creating efficiencies that have ultimately impacted the bottom line.
Virtual payment is a relatively new technology that’s resulting in major changes to travel management programs globally. For those unfamiliar with virtual payment, it’s a digital payment solution that assigns a unique virtual card number to each transaction and allows the buyer to set specific parameters around its use, including a dollar amount, date range or vendor. Virtual payments work similarly to credit cards, but only exist digitally.
There’s a huge need for this type of solution in the business travel world: it addresses many of the issues that make payment management a pain point for many organizations. First off, virtual payment enables better travel budget control by enforcing travel policy: if a traveller attempts to use their virtual payment code outside the determined parameters, payment would simply not go through. Virtual payment also provides greater fraud protection, improved data collection capability, simplified reconciliation and overall increased efficiency. For businesses looking to bring in clients, out-of-town interview candidates, guest speakers or contractors, enabling virtual payment means they can manage the associated expenses entirely, making the travel experience easier and more enjoyable for these individuals.
For employees, virtual payment means not having to incur expenses on their personal credit cards, alleviating financial burden and a potentially cumbersome expense reimbursement process. It also provides travellers with clear parameters around their travel budget while allowing opportunity to pay the difference if they choose to opt for a pricier menu item at the hotel restaurant, for example.
The consumerization of business travel continues to impact traveller expectations for their business and leisure travel experiences to be the same across booking, personalization, technology and payment. While disruptive to traditional payment models, virtual payment is arguably the least disruptive technology-driven opportunity for business travel to “catch-up” with consumer experience driven expectations, while offering big returns for both travellers and travel managers.
For all the reasons above, virtual payment technology has been steady adopted since its launch in 2016. Globally, the number of American Express Global Business Travel (GBT) clients using Virtual Payment Expert, GBT’s hotel payment solution powered by Conferma Pay, doubled last year, and continues to climb as the technology becomes available in more countries and usage options expand. Canada in particular has seen a surge in virtual payment adoption this year, following 2018’s spike in the US.
Looking ahead to 2020 and beyond, virtual payment capabilities will continue to expand to include other facets of travel – including air, rail and car – creating an even simpler process for businesses to manage and reconcile their travel spend while remaining compliant. This will allow companies to migrate further from traditional payment methods, like corporate or employee credit card, that have proven to be time consuming to reconcile and create opportunity for misuse.
If you have not yet decided to make virtual payment part of your company’s travel program, consider how integrating this technology can help you alleviate the pain points. With expanded capabilities on the way, this is an ideal time to adopt this technology.