One of our most frequently asked questions about card-based virtual payments is, "Is this too good to be true?" I've found that potential virtual card users have a healthy amount of skepticism about a technology that offers better payments and increased revenue, with no investment by the buyer. In fact, "is this too good to be true?" is one of six key questions it's important to ask of your prospective virtual card provider before you sign a contract. Here they are:
1. How happy are my vendors going to be participating in this program?
This one might surprise you, if you're more concerned about how your own team will react to adopting a new AP process, than how your suppliers might view it. But a successful virtual payments program thrives on a positive vendor experience - because without their acceptance of your payments, you have no virtual payments program. Ask a potential provider if you can talk to some of the suppliers in their network about their satisfaction with the approach. (And yes, of course, ask them to put you in touch with their existing clients to determine how happy their AP departments are with the program!)
2. How much vendor enrollment effort will I have to take on?
Your virtual payments provider needs to view vendor enrollment not as an afterthought but as a primary goal of implementation - and they should do all the heavy lifting. Does your potential provider have a dedicated vendor enrollment team? Existing relationships with your suppliers? Will they provide you with a supplier match so you can see how many of your current suppliers already accept this form of payment? And do they expect you to contact those suppliers that don't, creating additional work for your team?
3. Will this provider maximize the amount of spend that will be pushed through the virtual payment option?
A seasoned virtual payments provider will be able to tell you what percentage of your AP spend you can reasonably expect to convert to virtual payments, based on such factors as your industry or sector, and your specific supplier list. Since this percentage is a critical indicator of the potential success of your virtual payments program, it's important to ask your potential provider how they work to maximize it.
4. How seamlessly will this provider’s technology integrate with my company’s existing payments platform?
A virtual payments program can only succeed if it works with your ERP or other accounting software, and doesn't require costly infrastructure updates to run. If you're looking to upgrade your software anyway, your virtual payments program should enhance the efficiency and efficacy of the new system. And might your electronic payments platform actually help pay for a new ERP? If your virtual card provider offers a strong rebate program, it could.
5. Can I take my virtual payments program with me if I change banks?
Is your potential virtual payments program bank-agnostic? If your organization needs to change financial institutions, will you have to start all over with a new electronic payments platform? With a dedicated virtual payments provider, switching banks shouldn't result in any downtime for your electronic payments program - just update your bank account information with them, and keep on paying.
6. Yes, but IS this all too good to be true?
It may sound far-fetched, but virtual card payments really do offer a significant revenue share on top of easier, more secure payments, at no cost to you as a buyer. Just ask the 20,000+ buyer organizations and 1 million+ suppliers now using this platform.