Virtual debit cards are becoming increasingly popular as they allow small businesses to take care of all their banking needs from one convenient platform. They also save you from the hassle of having to carry around multiple banking cards and from overspending on your corporate credit cards. The best part is that virtual debit cards are quickly becoming the new standard for small businesses, so there’s definitely no need to wait to get started.
It has been reported by McKinsey that mobile banking channels have increased by 20-50% during COVID-19, and they look to be on a trajectory to dominate the industry from here on out.
In another McKinsey study, consumers demand a more flexible digital banking journey. Almost 71% prefer multi channel interactions, and 25% want fully digitalized private banking experiences with remote human support. The fact is that digital-first service providers and neobanks are better suited to responding to today’s consumer expectations.
Creating virtual debit cards is pretty straightforward and can be done entirely online. In this blog, we'll take you through all the details of a virtual debit card, how to create one and how it can benefit your business. So let's get started!
Virtual card vs physical card
When creating a virtual debit card, the key difference between it and physical cards is that virtual cards are not associated with any specific bank account. This means that you can use them to draw on funds from any participating bank or financial institution. Typically, there’s a small fee attached to using a virtual debit card compared to using an actual physical card, but this is usually worth it given all the benefits that come with having one. For example, you don’t need to carry around multiple cards or worry about lost or stolen credit/debit cards - everything is handled through the virtual card software.
Physical cards do not represent your virtual debit cards, meaning they’re not a digital version of one of your physical cards. They are entirely different and have their own CVV, card number and expiration date. They can be stored in your phone wallet and used anywhere in the world. Awesome right? Here are some more advantages of using virtual debit cards:
- Your virtual debit card is linked to your bank account so you can easily draw funds from it.
- You don't need a physical card for everyday use - just the virtual card software on your computer or mobile device.
- Your transactions are immediately processed and available for viewing in your account history. This means less time spent going through lengthy bank statements!
- You can set limits on your card which can save you from overspending.
How to create a virtual debit card for your business
The process of creating your own virtual debit card is quite simple, and can be done in just a few minutes online. Here’s how it works:
- Firstly, you'll need to sign up for an account with an authorised financial institution that offers digital cards. You can find more information about this on their website or by contacting them directly.
- Find the section on their website where you can create a new account. This is usually under "Personal" or "Business."
- Follow the instructions to create your account. You will likely need a few sets of documents to prove your legitimacy.
- Once you have created your account, log in and go to the section where you can create a new virtual debit card.
- After registering, you can follow the instructions to create your virtual debit card.
- Once you have created your account and verified your identity, all you need to do is load funds onto the card and use it for transactions at participating merchants. You can withdraw money, make purchases, and pay bills using your virtual card.
This could be done through traditional banks like HSBC, ING Direct or Citibank or financial service providers like wamo, Revolut or N26.
Traditional Bank vs Financial Provider: Which one to choose?
While both traditional banks and financial service providers aim to provide seamless financial services to small businesses and expats, that's the only similarity between the two.
Traditional banks have typically been around much longer and are more established in the countries they function in, however, they fall behind when it comes to innovation and technology. On the other hand, fintech companies might have a small share of the market, but consumers are driving more towards this market considering their competitive prices, quick turnaround time and cost-effective solutions.
Free Instant Virtual Debit Cards with wamo: how to get one
wamo is one such holistic financial management platform designed to support small to medium sized businesses and entrepreneurs with a goal to set up and run a business whether at home or across borders. wamo enables businesses that have struggled in the past to open a business account due to the stringent processes and long timelines of traditional banks.
wamo has developed cutting-edge technology that makes it easy for you to get your virtual debit card up and running, as well as to withdraw money, make purchases and pay bills.
You can register for a business account in 10 minutes, complete your process within 24 hours and apply for your instant virtual debit card at zero cost. Additionally, you get access to multiple fee-free features and benefits that enable you to make international transactions, hold multiple currencies in multi-currency accounts, manage sub-accounts and run a smooth business internationally.
To get set up with wamo, download the wamo business app from Google Play or the App Store, submit your required documents, open a business account and get started with your virtual debit card right away! It’s that easy.