56% of CFOs Say Virtual Cards Are Key for Managing Financial Flexibility

Middle-market companies are turning to virtual credit cards to manage working capital more effectively.

Offering the same flexibility as traditional credit cards, but with enhanced spend tracking and better control, virtual cards are gaining traction among North American companies with revenue between $50 million and $1 billion.

A PYMNTS Intelligence report, “CFOs Want Virtual Cards in Their Toolkits,” explores how these companies plan to increase their use of virtual cards in the next year, driven by a need for financial flexibility, managing unplanned expenses, and managing economic uncertainty.

Adopting Virtual Cards

While virtual credit cards are in the early stages of adoption among middle-market companies, their usage is growing. According to the report, just 3.3% of North American Growth Corporates use virtual cards. This is less than half the adoption rate of traditional corporate credit cards, which are used by 7.6% of companies in this revenue range.

Virtual cards fall behind other popular working capital solutions, such as working capital loans (32%) and bank lines of credit (31%). Despite this, virtual cards are projected to become more popular, as 14% of surveyed CFOs and treasurers plan to adopt virtual cards within the next 12 months — representing a 322% increase in usage.

The highest levels of interest in virtual cards are seen in the media and technology sector (28%) and the fleet and mobility sector (26%), indicating high demand in industries where financial flexibility and operational control are critical.

Flexible Financing

Unplanned expenses represent a major challenge for CFOs seeking to optimize their working capital. According to the report, 42% of Growth Corporates identify unplanned expenses as the main reason for leveraging working capital solutions. Virtual cards, with their ability to issue temporary, single-use numbers tied to specific expenses, are particularly well-suited to address these unpredictable costs.

For companies using virtual cards, 56% cited the ability to meet demand and opportunity as the most important benefit — higher than the share of users who report similar advantages from other credit tools, such as traditional credit cards and lines of credit (approximately 25%). This makes virtual cards an ideal tool for CFOs who need to maintain flexibility while controlling expenditures, especially when facing unexpected financial needs or opportunities.

Protection Against Uncertainty

Due to economic volatility, CFOs use virtual cards to mitigate risks and maintain financial stability. Consider 34% of Growth Corporates expect a global recession to occur in the next year, a concern high among companies in the agriculture, media and technology, and retail sectors. Additionally, supply chain disruptions are top of mind for CFOs.

Given these risks, 56% of CFOs say flexible working capital solutions like virtual cards are essential to managing cash flow during unpredictable times. Virtual cards offer a strategic advantage by offering more control over spending, quicker approval processes, and the ability to adjust to changing financial needs.

Virtual credit cards are becoming a key tool for middle-market companies to improve working capital management because they offer better control, spend tracking, and seamless integration with supplier payments.