Transactions processed by virtual cards is expected to treble over the next five years to exceed a colossal $5trn, a new study from Juniper Research claims.
The estimates for 2020 place virtual card transactions to total $1.6trn, according to Virtual Cards: Consumer & Business Adoption, Competitive Analysis & Market Size 2020-2025.
B2B virtual cards will be responsible for a large chunk of this, accounting for around 80% of the transactions.
Virtual cards are temporary, random digital card numbers that replace core payment details for specific online transactions.
Juniper went on to explain that due to the Covid-19 pandemic and reduction in travel, it is forecasting a 4% decline in spend levels this year. This is in contrast to an 11% increase in the amount of transactions forecast for the same period. The rise in usage is due to businesses needing to authorise remote spending, it claims.
Despite this, Juniper actually expects only around 3% of businesses using virtual cards, since high processing charges for cards make suppliers reluctant to use them.
Research author James Moar said, “Virtual cards often require additional software to use, which the average eCommerce user is not going to take the time to set up for mostly unseen benefits.
“The technology needs to become more automatic, and allow more features, if it is ever going to gain traction beyond a few specific products in the consumer market.”
Consumers will be less likely to adopt virtual cards, with the research claiming less than 20% of people will use them by 2025.
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