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Virtual credit cards for e-commerce: Unlocking high credit limits and real cashback rewards

With more and more entrepreneurs choosing to start online businesses, there has been a significant shift towards e-commerce in recent years, and for good reason. Statista reports that the European e-commerce market is projected to surpass the one trillion dollar mark in revenue by 2027, reflecting its continued rapid growth and dynamism.

business owner handling online orders

As mentioned above, several factors, including the growing popularity of online shopping, advances in technology, and the increased accessibility of online marketplaces, have contributed to the rise of e-commerce.

And although starting an online business offers many benefits - such as low start-up costs and the ability to reach a global audience - it also comes with its own set of challenges. 

For one thing, competition in e-commerce can be fierce. And cumbersome processes like inventory and receipt management, payment processing, reporting, shipping, returns, and fraud prevention can be extremely daunting.

Luckily, in this article we will explain how e-commerce businesses can reduce their operational burden by using virtual cards while earning real money back on every transaction.

Read on!

Why do e-commerce businesses face obstacles in finding the right credit cards?

Before we get into the nitty-gritty, here is a quick primer on the difference between traditional banks and modern corporate card institutions.

Traditional banks vs Modern corporate credit card institutions 

Traditional banks and modern corporate credit card institutions differ in their focus and approach to serving businesses. 

Traditional banks have historically been the go-to source for borrowing and lending to businesses. Unfortunately, getting a loan from a traditional bank is a long and complex process that requires extensive paperwork and is particularly difficult for small or new companies. 

In contrast, modern corporate credit card institutions focus on providing credit and other financial services tailored to the needs of business. They offer streamlined applications, faster approvals, and lines of credit that are quickly accessible, all designed to help businesses manage their finances more efficiently.

Additionally, some of them offer unique features like virtual credit cards and customized rewards programs that provide additional benefits.

Overall, while traditional banks remain a staple for many businesses, modern corporate card institutions offer businesses of all sizes a streamlined, efficient approach to managing finances.

Struggles e-commerce businesses face with traditional banks

  1. Transaction volume: E-commerce businesses tend to have higher transaction volumes than brick-and-mortar businesses. Therefore, traditional credit card issuers may view high transaction volumes as a greater risk and are often reluctant to extend high transaction limits.

  2. Limited cashback options: Some credit card issuers may not offer credit cards designed specifically for e-commerce businesses, and those that do may have strict eligibility requirements or limited rewards programs.

  3. Inconsistent exchange rates: Traditional cards can make it difficult for e-commerce businesses to calculate the exact cost of a transaction because they may use inconsistent exchange rates that vary depending on the time of day or card issuer.

  4. Choosing the right card type: With so many different types of cards available, including credit, debit, prepaid, and charge cards, it can be challenging for e-commerce businesses to choose the right card type for their needs.

  5. Balancing security and comfort: E-commerce businesses have multiple cards to manage. Not to mention different currencies or features that can be difficult to track and reconcile.

💳 To help alleviate some of these problems, e-commerce businesses can consider working with a financial institution that offers transparent exchange fees, high-velocity cards, and competitive rates. 

Pliant corporate credit cards for ecommerce businesses
Pliant virtual credit cards provide ecommerce businesses with high-transaction limits, enabling them to maximize their ad spend and increase their ROI.

Advantages of High Velocity Credit Cards for e-commerce businesses

High Velocity Payment Instruments (HVPIs), also known as High Velocity Payment Cards (HVPCs), are virtual credit cards that enable fast and secure transactions with high credit limits. They are designed for businesses requiring frequent, high-value transactions, such as e-commerce businesses.

They make it possible for businesses to make larger purchases and to scale up their operations more quickly. It also provides enhanced security features to prevent fraud, which is especially important for online merchants operating in a cyberthreat environment.

Plus, they often offer real money back on every purchase! This can help reduce costs and increase profitability, which can add up to significant savings over time.

How are virtual credit cards (VCCs) and cashback programs revolutionizing e-commerce?

For e-commerce businesses looking to increase security, reduce costs, and gain a competitive edge, VCCs and cashback rewards can be a great option.

Here’s why:

  1. High-velocity cards with high transaction volumes: By providing a more flexible and secure payment solution for e-commerce businesses, virtual credit cards offer higher transaction volumes than traditional banks.

  2. Instant card generation: Virtual credit cards can be created and used instantly. This allows merchants to process transactions quickly and efficiently. Traditional banks no longer need to issue physical cards or run lengthy credit checks.

  3. Simplified cashback rewards redemption: To make it easier for e-businesses to redeem their rewards and enjoy the benefits of their cashback rewards. Some institutions can offer simplified redemption processes, such as automatic statement credits or cashback deposits.

  4. Real-time exchange rates: Virtual credit card issuers can provide real-time exchange rates for international transactions, giving retailers more accurate and up-to-date information on transaction costs. This can help them avoid surprises and be more in control of their spending.

  5. Seamless integration with other financial tools: some VCC issuers offer a smooth integration with other financial tools, helping merchants track expenses and better manage currency exposure and receipts. This will help e-businesses avoid losses and better manage their liquidity.

  6. Multiple generation of single-use cards: conveniently, VCCs can have multiple card numbers associated with a single account, allowing e-businesses to generate unique card numbers for different purposes and transactions. It is harder for scammers to steal card information and use it to commit fraud.

  7. Global acceptance: Pliant Virtual credit cards are powered by Visa and accepted worldwide, enabling e-commerce businesses to process transactions with ease.

Why are VCCs the go-to option for e-commerce businesses?

To sum up, virtual credit cards have become an increasingly popular payment method for e-commerce businesses because of the benefits they offer.

Such as:

  • Higher cash back rewards (which can be a significant source of savings over time) 

  • Enhanced security features

  • Greater flexibility in managing payments 

As a result, they can optimize their financial performance and increase their profitability.

Benefits and facts of automating e-commerce financial processes

According to a survey conducted by McKinsey & Company, the pandemic has accelerated the adoption of automated technologies by e-commerce companies. As a result, more than 60% of companies surveyed reported increased investments in automation, and 70% said they expect these investments to increase over the next three years.

Additionally, e-commerce companies are using payment processing software to automate the process of collecting and reconciling payments, thereby reducing manual effort and ensuring that payments are processed in a timely manner.

Robotic Process Automation (RPA) is being used to automate repetitive tasks such as entering data, reconciling, and reporting. This frees up staff to focus on more strategic tasks that require human expertise.

Financial analytics software is also used to automate reporting and analyzing financial data to provide real-time insight into financial performance. This, in turn, enables e-commerce businesses to make informed decisions about their operations.

And by automating financial processes like accounts receivable and accounts payable, eCommerce companies can better manage their cash flow and ensure that they are paid on time.

💳 To discover how other e-commerce companies are experiencing the advantages of our best-in-class corporate credit card solution, click here.

Duline Theogene, Author

Duline is an SEO writer and content strategist with several years' experience blogging on topics related to eCommerce, marketing, education, travel, and finance.