Virtual vs. Physical Cards: Trends in Corporate Credit Card Usage

As business travel gradually recovers to pre-pandemic levels, companies are shifting from traditional corporate credit cards to virtual credit cards. This move aligns with the ongoing digitalisation of business-to-business (B2B) payments, as virtual cards can now be integrated into travel management systems, enterprise software, and B2B payment platforms.

Physical credit cards, however, are not becoming obsolete. Travel-and-expense (T&E) cards are expected to grow, while procurement cards may see slower growth compared to other corporate cards.

Recent trends in commercial credit card spending reveal that Western Europe and the Asia-Pacific region are leading in corporate card use, with virtual cards showing the highest growth in these areas. Instant payment systems could challenge commercial cards in the future, particularly if they facilitate cross-border transactions effectively.

In the Latin American and Caribbean regions, corporate card usage remains significant, although virtual cards still account for a smaller share due to limited supplier acceptance. Similarly, Central and Eastern Europe, the Middle East, and Africa have experienced a decrease in projected commercial card spending growth, influenced by regional conflicts that impact business travel and spending.

Virtual cards are growing rapidly in Asia-Pacific and Western Europe, despite lower growth rates compared to other regions. The rise in virtual cards is driven by advancements in online B2B marketplaces, digitalisation, and enhanced fraud prevention.

Businesses are increasingly adopting virtual cards due to their enhanced security, control over spending, and seamless integration with accounting systems. Virtual cards generate unique numbers for specific transactions or limits, reducing the risk of internal fraud and offering precise control over spending. However, not all suppliers are equipped to handle virtual cards, which can complicate their implementation.

In addition to virtual cards, recent innovations include integrating corporate travel cards into mobile wallets, allowing employees to make contactless payments without carrying physical cards. This development, along with card tokenisation in mobile wallets, enhances security by protecting against card skimming.

These advancements suggest that the use of virtual cards and digital payment solutions will continue to expand globally, providing more secure and efficient options for managing business expenses.