4 Things to Consider when Choosing a Centralized Payment Option
Companies face many obstacles when tightening a travel program. Travelers may have cemented habits like booking outside the Travel Mangement Company (TMC), using personal cards, and putting rewards programs above company policy. Influencing this behavior is tricky to navigate and travel managers are often left with few options outside of pushing for a mandated travel policy. Centralized Payment and Virtual Cards are an excellent way to create a “soft mandate” and reign-in these expensive actions. Here are a few things to keep in mind when you are deciding to implement new centralized payment:
Is it easy to use?
Often, travelers are making decisions based on convenience. It is easier to book in the way they are comfortable rather than worry about compliance or whether vendor targets are being met. By using an automatically generated Virtual Card as the primary payment option, travelers must remain within the bounds of the TMC. Travel managers can communicate, to travelers, the potential time savings when submitting expenses as well if the TMC offers an API integration with the expense tool. Travelers will naturally change their booking behaviors to avoid the additional work that this solution eliminates.
Is it widely accepted?
This is an imperative point to consider when it comes to hotels. Different hotel properties and chains require different pieces of information to confirm a booking using Virtual Cards. When your TMC sends a detailed authorization fax, the friction and frustration during check-in greatly decrease for travelers. Additionally, there are available Virtual Cards that will only work for hotel and not air. Be sure that the solution you choose can be applied to as many transactions as possible to reap the full benefit.
Will it improve your travel program?
Traveler experience can make or break a program. One of the largest areas of contention for travel managers is how to handle guest travel. Virtual Cards and Centralized Payment can vastly improve this process by removing the need to issue extra corporate cards to contractors. Travelers should also be able to apply the Virtual Card product either online or offline without any change in process or issues. Another issue for travel managers and finance departments is the amount of time spent reconciling credit card charges against what was booked and expensed. With an integrated Virtual Card solution, you can reduce or even eliminate the need to spend hours comparing charges. Be sure that the solution you are choosing offers comprehensive reporting.
How will the product affect costs and compliance?
Many Central Payment and Virtual Card programs include a rebate as an incentive. However, for some, this rebate may only include the travel spend, or there are additional transaction fees. Carefully compare these rebate choices, especially when there are some that are so aggressive, they may significantly offset the cost of your managed travel program. Limiting the chance for fraud and added ancillary fees will also reduce the overall travel spend. By implementing Virtual Cards that are generated for the specific amount of an air or hotel booking, the chance of a traveler upgrading out of policy or charging anything unapproved back to the card is removed.