CloudX Blog

3 Reasons To Consider Virtual MasterCard For ePayments

Posted by Chris Cosgrove

Oct 17, 2017 1:51:17 PM

Virtual mastercard is almost as tasty as krispy kreme!


They say you can never get enough of a good thing.


This certainly holds true for certain food items...especially if you’ve ever had Krispy Kreme’s when that magical red light is on in the window, but I digress.  In the realm of B2B payments and ePayments, one thing that you can’t get enough of is virtual card payments.  We’ve covered this in detail over here, and while we won’t go into the full laundry list of details that encompass the reasons why virtual card payments make sense, one of the big reasons is they make cents...lots of cents...specifically percents.  It’s no mystery that virtual card payments represent a means by which businesses can monetize their payment stream and thus make their back office a huge contributor to the fiscal health of the organization, but way beyond that, the security of said financial transactions can be greatly increased through this novel approach to payments.

Sometimes with change you typically encounter turbulence.  


One manner of turbulence that is a byproduct of the disruption that is happening in this specific type of payment is the adoption on the supplier side.  While suppliers are typically eager to cash in on the payments due to them, there is sometimes a sticky barrier to allowing for card payments because of the manual entry and reconciliation of these payments.  However, according to that specific item is even being addressed through service providers who are automating how the booking of virtual card payments is occurring, which in layman’s terms is very cool.  This means the pathway becomes smooth and mutually advantageous while providing a welcome financial incentive to adopt this payment mechanism to the payor.

So, for the duration of this article we want to focus on the security components that are enhanced through these newer virtual card payment types.  

  1. Invoices are paid via a single use virtual card account so there’s no data to steal and the account is funded just for that single transaction, which can encompass one or multiple invoices.  This means card data, where other might have used a regular card to pay invoices, can’t be used to pay things fraudulently and the exposure is minimal as it is isolated.
  2. Payment requests / invocation can be made to travel through an approval workflow, thereby securing the necessary stakeholders and authority, again cutting down the chances for fraudulent payments by way of visibility to a matter.
  3. Greater control for the timeline of payments is achieved through virtual card payments.  Instead of having to deal with physical output of a check and then the correlating wait for transit times, handling, and deposit times, these transactions are deliberate, scheduled, and prompt.

To learn more about how to extend the use of virtual cards in your organization, check out this brief here.

Virtual payments represent one of the four significant pillars that can contribute to maximum health in your AP organization, but there are various other ways you can extract even more value from this function.

Download The Four Keys To Maximizing The Strategic Value of Accounts Payable

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Topics: virtual mastercard, epayments, virtual card

Making the best use of data in Accounts Payable Software

Posted by Chris Cosgrove

Oct 3, 2017 12:16:54 PM

Best Accounts Payable Software Makes Big Data Meaningful

It’s all Greek to me.

We’ve all heard this adage in one context or another.

In the day and age of big data however, this is not necessarily a good thing and for too many businesses, their data is unfortunately all Greek to them.  With that said, there are many savvy and intrepid businesses that are maximizing the raw power of their data to achieve enhanced business outcomes.  That’s all well and good, but what does it have to do with Accounts Payable software?

We’re glad you asked!

We’re going to look at a few different scenarios as it pertains to this question over the next week or so, and in the first example we want to share with you a client win who was able to leverage cloud based accounts payable software deployment to achieve multiple things.  In this instance the client was a large consumer packaged goods maker who had multiple, disparate accounting and inventory system that presented a major challenge to integration and data aggregation.

Here are the main take-aways from their experience with cloud based account payable software:

  1. They were able to streamline their frenetic and highly seasonal approach to invoice processing to be something that was streamlined and scalable.  Where they used to have to augment staff heavily to meet the demands of their yearly peaks, they now possess the ability to scale and adjust through the automation afforded to them with accounts payable software.
  2. They were able to make their data meaningful.  This is probably the key to the entire post today in that data is entirely useless unless you can digest and interpret it.  For many businesses, especially as it relates to AP invoice processing, there is little to no data analysis and certainly less intentional action around invoices.  For too many business the raison d’etre for AP is simply pay the bill when it come in.  This is a major disservice to the strategic function of AP and ultimately will cost said organization lots of dollars through blown opportunities by way of missed discounts and tacked on penalties.  We believe the best way to make data meaningful from the steady stream of invoices that pour in is by utilizing a tool like advanced OCR technology to extract all the data from an invoice and then run it through a logic based automation tool that looks for and identifies key data sets...invoice number, vendor name, due dates, terms, line items, totals, tax, freight, etc.  All of this can then be used for later analysis and action.
  3. They were able to assemble a data warehouse where their legacy system was unable to.  This is partly due to the flexibility of cloud based accounts payable software and the implications that most cloud technology has over fixed, static, legacy systems, but in this case, the client was actually able to establish vendor contract data in the cloud based upon the stream of invoices that was pouring in.  Granted one of the assumptions that was made and accepted by the client was that there was a certain good faith element to accepting the customer pricing as listed on the invoice.  However, by implementing logic controls around price / item / and location variance, the client was able to triage invoices that underwent any kind of a price augmentation above a standard, pre-defined acceptable change threshold.  Where there legacy system was incapable of providing, clean, dynamic data, by housing this data in a new cloud based system, they were able to transform their insights and reporting to achieve never before seen clarity within their process and which ultimately ended up with enhanced vendor management and optimized financial outcomes in terms of payment. Beyond this they were able to monetize their payments through virtual Mastercard payments and make AP a profit center!

If this means something to you don’t let your process or lack of quality data hold you hostage any longer! Check out the eBook below or give us a shout and see if we can help you transform your accounts payable process!

Free eBook on AP Automation vs E-Invoicing:  What's Right For My Business?

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Topics: Accounts Payable Process, accounts payable software, virtual mastercard, data

Is payment by Virtual MasterCard the key to AP payment transformation?

Posted by Chris Cosgrove

Jan 21, 2016 3:37:43 PM

Virtual MasterCard and Virtual Payments are where it's at!

Some questions are easier to answer than others.


 When I ask my 4 year old the color of an object, or its shape, I get concrete answers back...and quickly...sometimes too quickly!


However, when it comes to deeper things, the answers aren’t always so clear, and that’s why we’re posing the issue above as a question.


Here’s a look at the facts about payment methodologies for Accounts Payable departments in the US courtesy of Paystream Advisors

Virtual Payments are the future!


What’s obvious from this chart is that most American businesses are still heavily reliant on check cutting to make payments.  Considering that many businesses are looking to enhance their productivity and profitability it’s kind of ironic that they are dependent on antiquated and costly ways of doing things, and in this case, paying the bills.


When you couple the fact that cutting a check has an average cost of $5.14 per check according to The Accounts Payable Network, and that wires can exceed $15 per transaction, you can start to grasp the magnitude of what you are literally sending out the door.  To do a quick analysis, just look at your non-payroll related checks that went out last year and multiply times those figures depending on your spread of payment types and you’ll have a healthy approximation for the total process costs you’re looking at.


So, how to evaluate whether virtual payments are a good option for you?


  1. Will my vendors accept?  - Well some make this evidently clear on their invoices in the remit or payment instructions areas.  For those, the task is easy to figure out.  For others, it may require a more assertive campaign of vendor onboarding, which can be an arduous process for the company deploying the virtual payment inititative.  However, certain virtual payment providers actually act on behalf of your organization for the vendor enrollment and as such, can considerably offset the time investment required to advance it.
  2. Is it worth it? - Again, you’ll need to some quantitative and qualitative analysis on how your current payment metrics look.  If the bulk is via check or wire, then you have some basic math to do to determine your extraneous costs.  Beyond that, ask yourself what your payments are earning you.  If it’s either of the two mentioned here, that would be zero, zip, nada.  However the virtual MasterCard option could be anywhere from 1-1.5%.  Multiply that range by about a third of your payables spend (to allow for a conservative estimate of those who would accept the virtual payment) and you’ll have an idea of the annual contribution to your business.  Secondarily, multiply the correlating number of checks that you would normally produce for that spend times $5.14 or $15 for the wires and you’ll know what hard costs are going to be recouped….then ask yourself is it worth it?
  3. Is security an issue? - That’s definitely a worthy question.  Security is an issue for some AP departments, but the virtual MasterCard is more secure than checks and individual corporate card accounts that are used to pay multiple vendors.  Why? For starters, they are single-use, and a unique 15 or 16 digit card account is created per payment.  A payment may encompass multiple invoices, but the point is it can be reused.  Secondly, the amount paid is funded specifically for the payment amount invoked, and can’t be expanded.  Therefore, it can’t be run through multiple times or for increasing amounts and is therefore a better alternative than using one traditional card to pay multiple accounts.


So, there are certainly some compelling elements to making the case for virtual MasterCard, but probably none more-so than profitability.  If you’re looking for a way to make your accounts payable process strategically valuable and profitable, then this is a key thing to consider!

Free Whitepaper on Why CFO's Are Ditching Checks!

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Topics: Accounts Payable Process, Virtual Payments, Virtual Credit Card, virtual mastercard

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