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Almost overnight, the pandemic forced many companies to move their operations online and make payments digitally, leading to a host of new challenges including an increase in fraud and cybercrime. As a result, virtual cards – a payment card that exists only in virtual form – are more relevant than ever due to their wide variety of benefits suited to the contemporary business environment.

For example, virtual cards can be issued and sent digitally, meaning that companies can use them to transact straight away without waiting for a physical card to be delivered – ideal for companies eager to move quickly.

Virtual cards can also help protect against fraud by being easily freezable – you can freeze your card immediately after a payment, unfreeze it when you want to make another payment, before freezing it again. So even if the virtual card details are intercepted they cannot be used by the fraudster.

Virtual cards are more secure than physical cards since they cannot be lost. Card details can be accessed via web or mobile applications.

When allocating cards to employees, you can see exactly what they spend and where to submit receipts for reimbursement, avoiding the risk of human error. It saves valuable time when managers would previously have had to go through each submission and check every receipt.

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The virtual card industry is set to skyrocket, fuelled by a greater need to authorise spend remotely. A report from Juniper Research found that the annual value of virtual cards used by businesses will increase 90% over the next four years; exceeding US$1 trillion by 2022. This is up from an estimated $568 million in 2019.

And Hong Kong is a key part of this growth. According to GlobalData, a data and analytics company, the total number of card payments in Hong Kong grew from 642 million in 2015 to 1 billion in 2020. Hong Kong’s high-banked population and growing preference for contactless technology will likely support SMEs which align their payments models with virtual cards.

Marc Entwhistle, principal of Financial Services Practices at Oliver Wyman, based in Hong Kong, believes the future of virtual cards looks bright for both consumers and businesses. “Advantages range from instant issuance and provisioning into mobile wallets (rather than waiting for physical delivery and activation), to flexibility and security in relation to being able to generate and dispose of new or temporary cards for specific purposes or additional users, to increased customisation options, whether it be bespoke branding, granular spending restrictions, or ease of payment reconciliation,” he says. “As acceptance for online and mobile payments rises, the need for physical plastic will inevitably decrease.”

Neat, a tool for SMEs in partnership with Visa, has recently launched a Neat Visa card, which gives entrepreneurs flexibility and control over their business spending. Its cards are currently available in virtual form and will soon be available in physical form, meaning you can start using it as soon as your business is approved.

With an easy online setup, the Neat Visa card will be available in HKD and – in the future – USD. Neat Visa cards allow for streamlined local and overseas transactions, with the ability to set monthly limits and instant transaction notifications. Cards can be easily managed online and earn 1% cashback on all business purchases. Neat cardholders get access to more than 25 different perks including discounts on LinkedIn and Google Ads, as well as limited corporate liability and travel accident protection for your business and cardholders.

And lost expenses should be a thing of the past. You can photograph a receipt and tag it in the Neat App, which can also be integrated into accounting software such as Xero.

Igor Wos, co-founder and chief technical officer of Neat, said: “Our mission is to help SMEs grow their businesses internationally while making it easy for our customers to access financial services. Adding virtual cards to our proposition was a no-brainer. Virtual cards have an extensive amount of benefits, including allowing customers to create multiple cards and transact straight away to manage their expenses."

“Together, the security and spending control management creates a more effortless and time-efficient user experience for business owners who are already strapped for time."

Adding this virtual card into its suite of products rounds off Neat’s useful services for SMEs at a moment in time when a digital offering is most crucially needed.
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