Online and digital research company Juniper Research released a new report on Tuesday (March 19) saying the yearly value of virtual cards (temporary cards only usable for one transaction) is going to grow, but that adoption to the technology will be slow, according to a news release.
Business use of the cards is expected to grow by 90 percent through the next few years, and usage will pass $1 trillion by the year 2022. That’s an increase of $568 million from the estimated 2019 total.
The method of payment is still going to struggle for establishment against all other payment methods, the study said. It noted there are some key benefits to virtual cards. For example, they are excellent for anti-fraud capabilities, as even if someone steals the details, they can only be used by the purchaser.
The biggest adopter of the cards will be financial services, with transactions expected to grow 18.3 percent from 2019 to 2022. Growth will be slower in other sectors, like fleet businesses, because of the need for point-of-sale payments. Although healthcare is expected to be the highest-value sector, with some $277 billion in transactions by the year 2022, adoption will still be low. Only 4 percent of healthcare institutions around the world will adopt the use of virtual cards, mostly due to higher processing charges.
Virtual cards will generate more than $14 billion in revenue for card providers by 2022, mostly from remote purchases. These providers are positioned to protect buyers’ privacy and the ability to offer other digital ID-based services alongside the cards.
“Virtual cards offer a number of financial management possibilities, for both business and consumer use,” said research author James Moar. “However, the limits of the technology currently mean that virtual cards need to be part of a wider payment or security product.”