CORPORATE CARDS
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virtua l i n teg rat io n
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Sabre’s integration of Sabre Virtual Payments (SVP) into Sabre Red Workspace, used by 425,000 travel agents, is indicative of a trend to integrate virtual cards into the travel payments industry. SVP Red App uses Conferma virtual card number (VCN) booking and settlement technology and Corporate Travel Management UK (CTM) has spent the past 12 months beta testing SVP. The TMC has implemented the suite of Conferma products and rolled out Sabre SVP throughout its operation to allow VCNs to be raised and deployed for hotels. The integrated, secure payment facility ensures hotel payments during a trip are easier to manage, as is the expense reconciliation process. On completion of a hotel booking in Sabre, CTM consultants are notified to set up a Billback payment in the form of a singleuse virtual card, created with unique card number, expiry date and CVV. Card information is then securely passed to the relevant hotel and payment is made via the VCN at the time of stay. Bookings and payments are automatically matched in the reconciliation tool. “Previously, reconciliation could take up to two weeks and this has been reduced to two days,” says Director of Innovation & Smart Working for CTM UK, Averil Hooper. Travel managers also gain visibility of hotel payment with clean, consistent data in one place. “And SVP drives policy compliance, as the VCN includes only allowable expenses on payment confirmations to merchants within the authorised value,” she says.
enable clients to capture total trip costs because a unique number could be issued for a trip rather than just an element of that trip,” he says. For example, it could pay for a trip to New York, including air fare, hotel, ground transport and parking. “So it might be better to issue a personal card for the individual traveller and, for a trip to New York, you could issue a virtual card with a credit limit of £5,000, which gives plenty of headroom for all the things a traveller needs but still with some restrictions on suppliers and the date range in which it is valid,” he says. Education, training and raising awareness in both travellers and hoteliers would play an important role. Virtual cards also overcome an inherent problem with lodge cards, whose data is sketchy. A statement of air fares bought on a lodge card might show Derek Smith, D. Smith, Mr Smith, Mr D Smith or D Smith Mr. Even with the transaction dates, travel managers could struggle to marry up the information with the individual or cost centre. However, as a central means of paying for travel, as opposed to the vagaries of numerous corporate cards, lodge cards have a strong role in corporate life. “While lodge cards continue to be popular, and in some sectors are increasing in popularity, the long-term view is that a lot of central travel accounts could be replaced by virtual card,” says John Harvey. AirPlus’s lodge card is a UATP, largely used for flights. It provides detailed data, including employee identification, which is especially valuable for large companies that need to reclaim for unused air tickets, for example. The company’s A.I.D.A. is a virtual card with a particularly strong security feature: “Should a single virtual card be compromised, the corporate or TMC does not need to get a new account with us, whereas with some others, a compromise of the virtual card would mean comprise of their entire system,” says Jon Fox.
Touch and go
Given that payment by mobile involves near field communication (NFC) or touch payment, this is an area some card providers are looking at. “The first stop will be contactless on our cards,” says Citi’s Steve Robson, who does not yet see much demand for Apple or Samsung Pay functionality. Mobile wallets are, however, on the radar.
Lodge cards remain popular but the long-term view is that a lot of central travel accounts could be replaced by virtual card” “Digital wallets will enable a number of new services for travellers, including dynamic emergency card replacement and virtual cards issued specifically for individual trips or payments,” says Head of Commercials, Mastercard UK & Ireland, Kelly Devine. Barclaycard is able to issue single-use virtual cards through a mobile device and with required controls and American Express is integrated with them, including Samsung, Apple and Android Pay. “Increasingly, the travelling population is made up of millennials who are tech savvy and expect to be able to do everything on their smartphones, from searching through paying to uploading expense receipts. The more integrated your solution, the greater adoption you’ll get from your travel and expense programme,” says Barclaycard Commercial Payments' Maria Parpou.
The devil in the details
In December 2015, interchange fees (IF) were capped on consumer cards to 30 basis points of the merchant fee or 0.3%. For commercial cards, the average amount is 175 basis points or 1.75%. These are paid by acquiring banks such as Visa and
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