Working Capital Gets Rebrand as CFOs Harness Solutions to Fast-Forward Growth

The rules of the road are changing.

The fleet and mobility sector finds itself at the forefront of the winds of this transformation. The rise of electric vehicles (EVs), sustainability concerns and the emergence of mobility platforms that make it easier for drivers and riders or drivers and cargo to be efficiently matched all represent profound phase shifts for the industry.

“It’s like having two feet in two ponds,” Helen Jones, executive director of Visa Commercial Solutions Europe, told PYMNTS CEO Karen Webster of the dynamic between emergent vehicle and process innovations and incumbent workflows and fleets.

“Fleet managers are definitely evolving, and they are aware of these shifts to EV and digital, but they also have another foot in very well-established fuel-powered processes,” she said. “Everyone is looking to navigate this dynamic between a traditional fuel ecosystem and the tremendous change in sustainability and the accompanying regulatory changes.”

Leaders in the fleet sector are managing the transition with one of the most proven ways to support current and future business needs: working capital.

“This space in particular is the one the most active in terms of working capital,” Jones noted.

She explained that 82% of the fleet businesses Visa studied had used working capital in the last 12 months, with 96% of them reporting that they would use it to fund growth.

Growth Corporates in a Complex Ecosystem

As the transition to EVs gains momentum, chief financial officers in the fleet sector play a crucial role in navigating these shifting tides.

They must manage both traditional fuel-powered processes and the evolving aspects of sustainability and EV-based ecosystem evolutions. To do so, savvy financial leaders employ various financial tools such as lines of credit, working capital loans and virtual cards.

And speed and instant access to these solutions are increasingly driving CFO decisioning.

“The economic environment that we’re living in globally means that this speed of working capital — borrowing it fast, paying it fast, and instantly making decisions and purchases are [what CFOs are looking for in the solutions] being embraced right now,” Jones said.

The importance of agile and innovative financial strategies is increasingly crucial to driving the fleet and logistics sector forward.

“I think historically, organizations have shied away from having debt on their book or accessing working capital … [but] embracing working capital as a way of growing your organization is what we’re seeing the most use case for,” Jones said.

She explained that sector CFOs are tapping today’s solutions not to plug a cash flow gap — one of working capital’s primary historic uses — but rather to respond to change, respond to growth, and as a way of accelerating innovation around the EV transformation and sustainability agenda.

An Era of Ongoing Change Within a Traditional Environment

The fleet industry has witnessed a notable shift in its acceptance and use of virtual cards. Previously limited to fuel purchases and maintenance, virtual cards are now expanding their reach across fleet operations.

“Card acceptance in this space is probably at an all-time high and just continues to grow,” Jones said.

The integration of virtual cards into connected cars and embedded SIM cards has revolutionized payment processes in the fleet industry, enabling seamless transactions and streamlining operations, she explained.

This evolution in payment methods has become a key driver of success for fleet businesses in a rapidly changing and competitive landscape.

“Card is one of the cheapest ways you can borrow money, and one of the quickest ways and one of the easiest ways to pay suppliers, who are embracing more and more this new movement of money which is free of much of the manual paperwork and back-office systems and processes that support account-to-account or ACH,” Jones said.

“It’s safer. It’s protected. It’s quick. It’s ready. It’s available,” she added.

The consumerization of B2B expectations is reshaping engagements and driving the adoption of digital solutions more broadly, even outside of the fleet sector, as on-demand and ease of use become operational norms.

And as the digital ecosystem continues to evolve, the adoption of working capital solutions is expected to become even more prevalent, driving positive change in the operational landscape.

“When managed responsibly, working capital can definitely add tremendous value in terms of growth and in terms of adaptation to change by fast-forwarding an organization’s capacity to manage and embrace new innovative ideas and programs,” Jones said.

It’s something CFOs should explore a lot more, she added.