The adoption of API-based virtual card issuing platforms will be the pivotal driver in ensuring global virtual card spend continues to grow from its $3.1trillion value in 2023 according to research from fintech and payments markets research firm, Juniper Research.
Virtual cards use randomly generated and generally, temporary card numbers linked to a payment account. They process payments and replace genuine payment details. Virtual cards provide a secure and fast way to distribute funds. All the while, they effectively manage spending limits.
API-based virtual card issuing enables cards to be issued in a more seamless and cheaper way. It improves efficiency and unlocks greater use cases within B2B and consumer payments. So much so, global virtual card spend can increase by 355 per cent in the next five years to $13.8trillion.
Examining future market opportunities
The new market research suite offers the most comprehensive assessment of the virtual cards market to date, providing analysis and forecasts of over 39,000 datapoints across 60 markets over five years. It includes a ‘Competitor Leaderboard’ and examination of future market opportunities.
Research author Daniel Bedford commented on the report’s findings saying: “Virtual cards offer an adaptable solution that can be heavily customised, including spending limits and restrictions. They enable businesses to significantly improve their spend management while reducing costs.”
The new Juniper Research Competitor Leaderboard report reveals that Stripe, Revolut and Marqeta are the established leaders in the virtual cards space. Additionally, the report identified intuitive, API-based platforms, with easy-to-use functionality to securely deploy cards and manage spending restrictions, as the most important factors in their success.
Incentives driving adoption
In the highly competitive consumer virtual cards space, Juniper Research recommends that vendors offer loyalty- and rewards-linked cards, to differentiate themselves. Furthermore, exclusive offers on partner products, rewards points and cashback on specific merchants can successfully encourage virtual card spending and customer retention. This will require virtual card platforms to build out partnership ecosystems. Firms can achieve this by partnering directly with merchants, or with existing loyalty services.