Best practices of virtual card

BEST PRACTICES OF VIRTUAL CARDS

 

Virtual cards are gaining traction in the travel sector and are being used in a variety of ways, including automating the hotel direct bill process, boosting data for reconciliation, expediting the car rental direct bill process, and covering reservation agency fees. Even though they provide numerous benefits to a managed travel programme, travellers, travel managers, and trip coordinators still face challenges such as hotel acceptance, data accuracy, and mobile capabilities.

Some best practices in ultimately preventing issues for hoteliers are :

  • If the card has been pre-authorized at any point, the authorization codes must be utilised for subsequent payment processing. You should not authorise a card twice after it has been pre-authorized because this will result in a double authorization, which will result in a decline.
  • At check-in, two folios should be set up for all Virtual Card payment bookings. Folio A, with the defined charges to be covered routed to this folio and a virtual card number as a payment method. For all other charges not covered by Folio A, use Folio B with the guest payment method.
  • If the original source booking agent (OTA, Travel Agent) updates the reservation, you should charge the virtual card according to the instructions on the new reservation confirmation. To reflect the new numbers, the allowable usage amounts will have been changed. If the reservation is changed without the source booking agent’s permission, the traveller is accountable for the difference.
  • If you charge the wrong amount by accident, you can make extra payments up to the initial pre-authorized amount. You can issue a partial or full refund for the virtual card payment, but you cannot charge it again. If you need to make any additional adjustments, you must contact the booking provider (OTA, Travel Agent).

 

 

When organization’s embrace virtual card payments, there are several best practices that contribute to its success.

  • Leverage Technology –  By automating your AP processes, your company can save time and money. Automatically transmitting remittance details, electronically reconciling payments, and real-time visibility into payment status are just a few of the digital solutions that can help you save time.
  • Avoid long term contracts –  A long-term contract with your virtual card supplier limits your options if the service fails to deliver on its promises. A shorter contract encourages suppliers to keep earning your business after the initial registration term by expanding the card programme. It’s interesting inquiring about the provider’s client retention rate, since this may reveal how well it can enrol and increase supplier participation in virtual card payment systems for its customers.
  • Redeem Monthly/Quarterly Revenue Payments  – When you pay with a virtual card, a portion of your payment goes to the transacting bank, and the rest is returned to you. You should collect that revenue as soon as the bank allows it, which is usually monthly or quarterly at the most.

If you don’t already have a Payments Strategy in place, now is the time to think about how creating one might help your AP department become a significant element of your company’s overall growth. A virtual card might be an excellent initial step in your Payment Strategy for reducing costs and increasing income. Vafion’s expertise in Expedia and Stripe virtual card integrations can be of help to you in formalizing your strategies. For more details please contact us at info@vafion.com

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