B2B Payments

Amid Amex Controversy, Corporate Card Competition Heats Up

Corporate Card Competition Heats Up

The biggest news from the commercial card world this week came from American Express, which is facing allegations that it mistreated small business customers to hike card approval numbers.

According to The Wall Street Journal, American Express salespeople reportedly misrepresented small business credit card rewards and fees to applicants in order to close more deals. The publication described the tactic as “strong-arming” business owners, citing more than a dozen former and current Amex employees.

In a statement, a spokesperson for Amex said the company has “rigorous, multilayered monitoring and independent risk management processes in place, which we continuously review and enhance to ensure that all sales activities conform with our values, internal policies and regulatory requirements.”

It’s unclear what impact the allegations might have on American Express or its small business customer base, but the accusations have emerged during a time of growing competition in the commercial card market, with small businesses having more options should they choose to switch from a market heavyweight to a FinTech newcomer.

According to Bloomberg reports this week, American Express is the largest commercial card issuer on the planet, with a market value of $92 billion.

Yet venture capitalists are pouring into the commercial card FinTech arena, with players including Brex, Ramp and Divvy raising a combined $1 billion in funding and debt, reports said.

As competition heats up, commercial card players continue to introduce value-added services and benefits for corporates and small businesses, with new research showing that small businesses are using their card products for rewards, not debt.

According to new research from CreditCards.com, 70 percent of the 500 small businesses surveyed currently have a credit card, with 46 percent of those pointing to rewards as their favorite feature. Only 5 percent said a card’s ability to finance their purchases over time is the most valuable proposition of a card.

Below, PYMNTS looks at the latest initiatives among players to get ahead of the competition.

Visa, Intuit Team Up in India

Visa is looking to strengthen its small business proposition in India through a new collaboration with Intuit, reports said this week. Their partnership means Visa and Intuit QuickBooks will co-develop new products for SMBs in the country, with their first offering linking current Visa cardholders to a QuickBooks subscription.

The companies noted that their India collaboration follows a similar partnership in the U.S., which enables small businesses using QuickBooks to use its Instant Deposit service, a real-time disbursement feature that allows SMBs to use QuickBooks Payments to immediately deposit funds into their bank accounts via Visa Direct.

CSI Links Clients to Virtual Cards

Corporate Spending Innovations (CSI) has announced that its corporate customers will now have access to virtual card technology to pay for business travel, a feature resulting from its partnership with Conferma. Conferma will bridge CSI customers to its Conferma Pay solution, which includes a network of travel management companies, global distribution systems and online travel booking platforms, with the ability to use virtual cards to pay for that travel.

In their announcement, the companies said the partnership reflects “a wider trend as businesses increasingly seek virtual payment solutions from a single, preferred partner,” whether paying a vendor in accounts payable or booking flights for a business trip.

TripActions Dives into Corporate Cards

In another Visa collaboration – and another initiative targeting the corporate travel arena – TripActions recently announced the launch of TripActions Liquid, an integrated corporate travel management and payments solution. On the payments side of the solution, TripActions has launched a corporate card product that enables managers to configure controls on the card to manage employee spend.

In its announcement, TripActions pointed to the friction of employees using personal cards to finance business trips, with an integrated corporate card solution enabling automated reconciliation and spend management for managers while reducing the financial burden on employees.

Shell Rolls Out Fleet Card in India

Shell is another player looking to strengthen its commercial card position in India. The company recently revealed its suite of fleet spend and management solutions, including a prepaid card that enables control and visibility of fuel spend for fleet managers. The card is tied into a range of other services, including telematics and fueling services, reports said.

Cashplus Boosts Card Transparency With Google Maps

U.K. FinTech Cashplus is looking to Google Maps to enhance the value of its corporate card offering. The company’s small business credit card products are now integrated with Google Maps, enabling managers to geolocate where employees made their transactions to mitigate the risk of fraud and to elevate spend control. As Cashplus noted, the solution adds to its existing range of value-added services for its SMB cards, which include an open banking API to integrate spend data into back-office platforms.

Ramp Nixes the Personal Guarantee

In a recent conversation with PYMNTS, commercial card startup Ramp discussed some of the biggest challenges small businesses face when seeking a commercial card, with the need for the personal guarantee as one of the biggest barriers they face.

“A personal guarantee is a scary thing, and can really creep up on people,” said Ramp CEO and Co-founder Eric Glyman in a conversation with Karen Webster.

Nixing the personal guarantee is just one way Ramp is looking to compete in the increasingly innovative commercial card market.


New PYMNTS Report: The CFO’s Guide To Digitizing B2B Payments – August 2020 

The CFO’s Guide To Digitizing B2B Payments, a PYMNTS and Comdata collaboration, examines how companies are updating their AP approaches to protect their cash flows, support their vendors and enable their financial departments to operate remotely.