Virtual Cards for travel have arrived.

Incorporating Virtual Cards into business travel processes has been a growing trend for a while now. The most popular target is airfare, which is understandable since the reservation and payment occur electronically pre-travel. What about hotels? I have always wondered how well Virtual Cards work for lodging expenses. Then I came across a July 6 article published by Business Travel News (BTN) that sheds light on this topic. Following are some tidbits plus keys to success that can help you determine whether Virtual Cards might have a place within your organization’s travel management initiatives.

Virtual Card Usage with Hotels

For The Advisory Board Company, Virtual Cards are filling a need, as described within the article, A Travel Program & Its TMC Start Virtual Card Programs Together, by JoAnn DeLuna, Associate Editor, Payment & Expense, The BTN Group/Northstar Travel Group. I was most intrigued by their process, which relies heavily on the travel management company (TMC). Once the program expands to employees—it began in January for job candidates—their TMC will:

  • obtain a Virtual Card number from the card provider via an application programming interface (API); the spend limit will cover the room rate, taxes and fees
  • communicate the Virtual Card information to the hotel and follow up prior to the traveler’s arrival date

The Advisory Board Company recognizes the importance of travelers not having a negative experience, so they are working closely with their TMC. This is a critical piece. I have always envisioned issues related to hotels. With more organizations turning to Virtual Cards, hopefully hotels will respond with strong procedures and employee training. This would reduce the extra work by TMCs and/or organizations, and minimize potential pain to travelers. If the process is too onerous, Virtual Card usage for lodging could be limited.

When lodging is secured with a Virtual Card, will travelers receive the service they need when checking in?

When lodging is secured with a Virtual Card, will travelers receive the service they need when checking in?

Keys to Success

Interested in using Virtual Cards for lodging? Following are some key aspects to consider.

  • Partner with a travel management company (TMC) that can support Virtual Card usage
  • Work with your card provider to identify the best Virtual Card process for your organization and, perhaps, the best hotel targets
  • Ensure there are benefits to your organization, as well as individual travelers
  • Plan for potential hiccups, such as hotel clerks who do not understand the Virtual Card arrangement, and prepare your travelers
  • Recognize that employees will still need a form of payment for meals, incidentals, etc.; Commercial Cards provide advantages over personal cards

Like anything, there are pros and cons, but, with proper planning, Virtual Cards can be a viable option.

Resources

To learn more about Virtual Card usage by The Advisory Board Company, including their program goals, details about the process, and status to date, access the complete article at: http://www.businesstravelnews.com/Procurement/A-Travel-Program-Its-TMC-Start-Virtual-Card-Programs-Together.

See also travel-related content from Recharged Education, including how Declining Balance Cards can be a good fit, and more information about Virtual Cards.


About the Author

Blog post author Lynn Larson, CPCP, is the founder of Recharged Education. With more than 15 years of Commercial Card experience, her mission is to make industry education readily accessible to all. Learn more

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