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How virtual cards are revolutionizing fleet management accounts payables

May 6, 2024

In fleet management every minute and dollar counts. Operating within efficient financial processes will help ensure sustainable success for your business. This includes the management of accounts payables (AP) –  which some consider the backbone of financial operations for any business. 

Let’s explore the significance of accounts payables in fleet management and how virtual cards are transforming traditional payment methods.

What are accounts payables in fleet management?

Accounts payable represents one half of the balancing act known as the payables and receivables accounting process. The AP department tracks money going in and out of business accounts. Payables are the funds owed to suppliers, vendors, and other short-term debts, excluding payroll. Conversely, receivables are funds owed to the business, such as customer payments. Both play an important role in assessing the profitability of a business.

Your AP department is the anchor of your business’ finances. In the fleet industry, payables are instrumental in managing expenses related to maintenance, tires, and on-road repairs, among other operational necessities. From fuel purchases to vehicle maintenance, AP ensures that every expense is accounted for accurately and paid in a timely manner. For fleet managers, maintaining a well-oiled accounts payable system helps you build and maintain supplier relationships, manage cash flows. Ultimately, it keeps operations running smoothly. 

Traditional payment methods such as physical checks and ACH payments may present challenges that can hinder efficiency and increase operational costs. Physical checks often experience delays, manual errors, and face the risk of fraud. ACH payments may lack the detail and control needed for effective expense management. In recognizing these limitations, fleet managers are increasingly turning to a new solution for superior payments: virtual cards.

What are virtual cards?

Virtual cards are single-use virtual card numbers, which work just like the numbers on a physical card. Simply put, they act as a digital payment method, eliminating the delays and risks associated with physical payment solutions while also offering a range of benefits. 

Compared to physical payment methods like checks and ACH payments, virtual cards offer several advantages that make them an ideal choice for fleet management:

  • Faster payment processing: Reduced time and resources spent on manual reconciliation and invoice processing
  • Streamlined expense management: Access to detailed transaction data that can be easily integrated into accounting systems
  • Cost savings: Reduced processing fees and the elimination of paper-based processes

With virtual cards, businesses can generate unique card numbers for each transaction. These single-use numbers enhance security and mitigate the risk of fraud. Virtual cards also offer greater flexibility and control, allowing fleet managers to set spending limits, restrict usage to specific vendors, and track expenses in real time.

To implement virtual cards effectively, businesses should consider integrating them into their existing accounts payable processes. That may involve working closely with payment providers like WEX to customize virtual card solutions that meet your specific business needs. 

Use WEX virtual cards to pay suppliers and improve AP efficiency 

With WEX virtual cards, you have access to a range of benefits. WEX helps you make the most out of digital payment solutions.

WEX’s back-end payment processing platform helps optimize your customers’ payments processes so you can focus on innovation and growing your business. Manage everything from accounts payable to issuing to transaction processing.

The accounts payable automation solutions are designed to simplify payment processes and open up new revenue streams for businesses. A dedicated team engages with and enrolls your suppliers to accept virtual cards, helping you increase revenue through rebates. 

WEX’s supplier enablement experts collaborate with key suppliers to ensure smooth acceptance processes, making it easy for everyone involved. 

Partnering with WEX means experiencing accurate, automated, and secure payments that integrate invoice settlement and secure, one-time payments tailored to individual needs.

Addressing concerns in adopting virtual cards

Transitioning to virtual cards in fleet management offers numerous benefits, but it also brings about concerns about change. Resistance to leaving familiar payment methods behind is natural, but providing support and highlighting the benefits of virtual cards can ease this transition. Gaining acceptance from suppliers and managing virtual card transactions can be scary, but with the right approach and tools, these challenges can easily be overcome. 

The future of payment methods are heading virtual

Overall, virtual cards are revolutionizing accounts payable practices and helping create efficiencies in fleet management. They offer a modern and effective alternative to traditional physical payment methods. By embracing virtual cards, businesses can streamline their financial processes, enhance security, and gain greater control over their expenses. As businesses increasingly embrace digital solutions, virtual cards will continue to shape the way we transact, paving the way for a more connected, accessible, and secure financial ecosystem.

WEX is a leading, global fintech solutions provider, simplifying payments and back-end business processes in the fleet management, benefits management, and corporate payments areas. To learn more about WEX, a dynamic and nimble global organization, please visit our About WEX page.

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