The emergence of virtual card payments: Data highlights changes in North American commercial payment practices

To extend the use of card technology to highervalue transactions, card issuers now offer a range of ‘electronic accounts payable’ (EAP) products, often referred to as ‘virtual cards.’ In general, EAP is a non-plastic purchasing-card (p-card) account that is used to pay for goods and services after an invoice has been received. At that time, EAP card number information is transmitted or referenced for payment. The key feature of EAP is the dynamically adjustable line of credit supporting the account. Hence, the available credit on a card account is adjusted to match a specific transaction to be charged. After the transaction is completed, the available line of credit on the card is of little or no value. A wide variety of anecdotal commentary exists about the benefits of EAP, but facts about its use are limited. The purpose of this paper is to provide the reader with results from a recent survey about EAP use in North America. Specifically, the results show the types of EAP being used in North America, EAP spending norms, the benefits reported from EAP use, past and expected future growth of EAP spending, and the role of supplier acceptance to the success of EAP.