- Accessing Capital
- Enable Growth
Transforming digital B2B payments with Commercial Cards
Digital payments solutions, such as Commercial Cards, are transforming the ways that an organisation manages their operational and reporting requirements. In the final article in this series, Lewis Sun, Regional Head of Product, Asia Pacific at HSBC, discusses how Commercial Cards are at the forefront of the broader trend towards digitalisation.
We are living in a period of extraordinary change for businesses, as the digital revolution is eliminating time-consuming manual processes and replacing them with electronic alternatives. HSBC Commercial Cards solutions take the familiar corporate credit card and integrate it into a complete digital payments ecosystem. Across purchasing and virtual cards innovations, simplified payment processes are combined with data-centralisation to make detailed reporting easy.
Evolution of digital B2B payments
Smart Data's functions, and the visibility they provide, are all available online, which means a treasurer has full access to expense information from anywhere, including from the comfort of their own home.
The technology that underpins the way we purchase is continuing to evolve.The Virtual Card is a perfect example of the digital evolution. Instead of a physical card that an employee might keep in their wallet, a Virtual Card exists online, and is a convenient way to categorise payments for better budget management.
The Virtual Card function can generate an unlimited number of single-use card numbers,created under one account,with each of these numbers allocated to a particular spending category or reporting set. And since a Virtual Card exists only in the digital world, it can be linked to integrate into a company’s procure-to-pay system directly.
One of the key benefits that comes from the ability to generate single-use card numbers is that organisations are able to use cards to pay for large, low volume payments – such as meeting tax liabilities, covering digital advertising campaign costs, and utility bills.
As with physical cards, the finance team can monitor and control spending, produce standardised or customised reports, and complete convenient reconciliations. These functions, and the visibility they provide, are all available online, which means a treasurer has full access to expense information from anywhere, including when working from home.
Paying by card, allows a company to take advantage of up to 50 days of interest free credit*, providing treasurers with greater flexibility on how they time payments. Streamlined digital processes save money on labour, while the reporting and analytics insights help identify areas where spending can be reduced, or vendor relationships can be optimised.
Implementing a digitalised Commercial Cards Programme
It is crucial to choose a banking partner who can work with you to ensure that the change goes smoothly and efficiently.
When implementing a Commercial Cards programme, it is crucial to choose a banking partner who can work with you to ensure that the change runs smoothly and efficiently. When making this decision, several key factors emerge. First, it is essential that your banking partner can support your geographical footprint, providing a consistent platform in every country where your company operates. Remember that your international needs could grow as your business expands into new markets.
Second, it is advisable to choose a partner where you have an existing relationship. It is also advantageous if your provider has robust risk controls in place and strong credit fundamentals, making it well prepared to support your company’s growing financial needs.
Finally, and perhaps most importantly, it is essential to take full advantage of the automated solutions available to you, which is why it is necessary to choose a bank, such as HSBC, that offers an end-to-end digital and banking solution that incorporates direct and indirect expense reconciliation. This will prevent you from having to work with multiple vendors. The future of banking is increasingly digital, as businesses have growing expectations that technology will deliver cost savings and efficiency. As a result, treasury looks set to evolve over the coming years as more companies adopt new and innovative solutions to improve their working capital position. Operating a Commercial Cards programme is a simple and effective way to ride the wave of change, and achieve all the benefits associated with it.
In this series of articles, we have examined from a variety of angles the utility of Commercial Cards, and the many ways that they can free up cash in an organisation, simplify processing, and digitalise your treasury.
In a difficult and uncertain business environment, treasurers are heavily involved in realising a number of strategic objectives – such as managing costs savings and optimising working capital.Commercial Cards are an essential tool that allow treasurers to achieve these goals with all the efficiency you would expect from a digital solution.Start using HSBC’s Commercial Cards today or contact your Relationship Manager for inquiries.
*Days Payable Outstanding (DPO) extension of up to 50 days interest free. The number of interest-free days is dependent on the agreed billing cycle. Utilization of the card facility is subject to the terms and conditions which govern that facility and HSBC’s credit and risk policies.