Virtual cards – single-use or limited-use card numbers issued digitally – are soaring in popularity as a B2B payment method. In the next couple of years, they are projected to be the fastest-growing B2B payment channel, with transaction value surging (one study forecasts a 370% increase by 2028 for virtual card spend).
These “epayables” allow companies to pay suppliers via a credit card number without a physical card, often generating a new card number for each transaction or vendor.
The appeal of virtual cards lies in their security, control, and potential rebates. Each transaction has a unique card number, reducing fraud risk and giving precise control over spending limits, valid dates, and even merchant category restrictions.
From an efficiency standpoint, virtual cards make it easier to reconcile payments (each card can carry invoice data in its reference) and can be integrated into e-procurement systems.
Moreover, many companies are enticed by cash-back or rebate programs tied to virtual card spend – turning accounts payable into a revenue generator.
By 2026, virtual cards are moving beyond early adopters (like travel and media procurement) into the mainstream of AP departments.
As digital wallet adoption grows and card networks push tokenized solutions, even more B2B payments that once were ACH or check are apt to shift to virtual cards for the benefits they offer.
Travel & Hospitality: This sector was an early adopter (think travel agencies using virtual cards to pay hotels for bookings), and it continues to have an outsized interest. The pain of managing payments for thousands of travel bookings (and ensuring each payment is tied to a specific traveler/reservation) is solved elegantly by virtual cards – one card per booking ensures easy tracking and mitigates fraud if a card is compromised, since it can’t be used beyond its limit. The opportunity for travel management companies and corporate travel departments to earn rebates on hotel and airline spend via virtual cards is also significant, turning a cost center into a profit contributor.
Procurement-Heavy Industries (Manufacturing, Retail): Enterprises that purchase large volumes of goods – manufacturers buying components, retailers buying merchandise – are increasingly leveraging virtual cards for supplier payments.
The integration of virtual cards into procurement systems is key: procurement software can automatically issue a virtual card to pay a supplier when an invoice is approved, embedding controls like “card valid only for invoice XYZ, up to $N amount”. This addresses pain points around unauthorized spending and cumbersome purchase order to payment processes.
It also creates opportunity: companies can negotiate better terms with suppliers by guaranteeing fast, card-based payment, and in return sometimes receive a small discount (or they enjoy the card issuer’s rebate themselves).
The configurability and control of virtual cards within procurement workflows is critical to their rapid growth.
Healthcare & Education: These sectors, with numerous vendors and strict budget controls, show growing interest in virtual cards.
Hospitals, for example, can issue single-use cards for specific high-cost equipment purchases, ensuring the charge doesn’t go over a certain limit and tying the payment to a patient or department for easier cost accounting.
Universities can distribute virtual cards to departments or researchers with predefined limits, solving pain around petty cash and manual purchase orders.
The common thread is organizations with decentralized purchasing needs: virtual cards provide a centralized control with decentralized usage. Additionally, these sectors appreciate the security aspect – reducing fraud in an environment where many different staff might be making purchases.
Issuing Capabilities: Payment companies that traditionally focused on acceptance are now adding card issuing capabilities to ride this trend.
Processors and fintechs need to build or integrate with card issuing platforms that can create virtual cards on demand via API.
PayFacs serving corporate clients can differentiate their suite by offering a virtual card product.
Key tech features include real-time card generation, setting dynamic spend limits, tying rich metadata (like invoice numbers) to each card, and instant authorization controls.
Some providers partner with major card networks’ issuing programs to accelerate this – for example, using Visa or Mastercard’s tokenization services to generate virtual cards at scale.
The roadmap should also consider multi-currency card issuing as global companies may want virtual cards in different currencies for local vendor payments.
HOW PRAXENT CAN HELP
Launch virtual-card issuing platforms
ERP/Software Integration: To maximize virtual card adoption, payment tech firms must ensure their virtual card solutions plug into popular AP and procurement systems.
This might mean developing certified integrations or extensions for SAP Ariba, Oracle Fusion, Coupa, etc., so that finance teams can create and send virtual card payments from within their existing workflow.
Orchestrators might facilitate this by connecting ERP systems with card issuing APIs behind the scenes.
Essentially, the tech strategy should treat virtual cards not as an isolated module but as a feature embedded in payables automation solutions – e.g., an AP automation app where one click generates a virtual card to pay an invoice.
HOW PRAXENT CAN HELP
Integrate virtual cards with procurement/AP systems
Infrastructure & Security: With greater virtual card usage comes a need for robust security and fraud management.
Virtual cards are inherently more secure, but processors should still implement AI-based fraud monitoring on card transactions (e.g., to detect if a virtual card is attempted at an unauthorized merchant or split into many smaller charges).
Infrastructure must handle potentially large volumes of low-value card issuance – think a company issuing thousands of $50 virtual cards for various small suppliers.
The systems must scale for both card issuance and transaction processing, ensuring low latency (a user issuing a card expects it to be ready for use in seconds).
Tokenization and encryption of card data is critical, as is compliance with PCI DSS since these are card numbers (though often short-lived). Many firms might use network tokenization (like Visa VTS tokens) to enhance security and acceptance rates.
HOW PRAXENT CAN HELP
Build rebate analytics and spend-control dashboards
Payment providers are likely to push virtual card solutions in partnership with financial institutions or through channel partners. For instance, a processor might team up with a bank to offer its corporate clients a co-branded virtual card program that the processor runs in the background.
GTM efforts should highlight quantifiable benefits: reduced fraud, improved efficiency, and cash-back potential.
PayFacs in vertical markets can promote enabling their software partners to offer virtual cards to end-users – e.g., a construction software that lets builders pay suppliers with a virtual card and automatically log the expense. That creates a competitive edge for the software (and revenue share for the PayFac).
The technology and business strategy around virtual cards is about creating a seamless, secure experience that feels like a natural extension of current AP processes, and then selling the value: better control and even profit from your payables.
Praxent partners with payment providers to build issuing capabilities and AP integrations that make virtual cards effortless to adopt. We integrate issuing platforms, build upstream procurement system plug-ins, and develop the dashboards that deliver control and insight. Outsource this complexity to us so you can offer virtual-card programs quickly, securely and with minimal friction.
Learn more about Praxent’s B2B payments technology consulting and engineering solutions.
1. What is a virtual card in B2B payments?
A virtual card is a card number issued digitally (usually single-use or limited-use) that AP teams can use to pay suppliers without a physical card. Each card can be tied to a specific invoice, supplier, amount, or time window for tighter control and easier reconciliation.
2. How do virtual cards help reduce fraud in accounts payable?
Virtual cards significantly reduce fraud by using unique numbers per transaction or supplier, strict spend limits, merchant category controls, and short validity windows. If a card is compromised, the exposure is limited to that specific card rather than an entire corporate card account.
3. How do virtual cards integrate with ERP and procurement systems?
Modern AP and procurement platforms can generate virtual cards directly from approved invoices or POs. When an invoice is approved, the system calls a card-issuing API to create a virtual card with a capped amount and metadata (invoice ID, vendor, GL code), and then automatically reconciles the payment when the transaction posts.
4. What are the main benefits of virtual cards for AP teams?
AP teams gain better control (per-invoice limits and rules), improved security, faster payments to suppliers, easier reconciliation, and the potential to earn cash-back or rebate revenue. In many cases, virtual cards transform AP from a pure cost center into a contributor to margin.
5. Do suppliers actually like accepting virtual card payments?
Many suppliers do, especially when virtual cards are paired with faster payment terms and clear remittance data. While they pay card acceptance fees, they benefit from improved cash flow, fewer collections headaches, and often better visibility into which invoice is being paid.
6. What do payment providers and PayFacs need to support virtual cards?
They need card issuing capabilities (or a partner issuer), APIs for on-demand virtual card creation, robust security and fraud monitoring, multi-currency support for global vendors, and deep integrations with AP/procurement systems so virtual cards are embedded in existing workflows rather than managed in a separate tool.