Virtual Cards

#Understanding Virtual Cards

Virtual cards are:

• Digital Only: No physical card needed
• Single-Use: Automatically expire after one use (or set limit)
• Short-Lived: Expire in hours, days, or weeks
• Spending Limits: Set specific limit for each card
• Merchant-Specific: Can be restricted to single merchant or category
• Auto-Reconcile: Transactions feed to expense module automatically

Benefits:

• Security: Card number not reused, reducing fraud risk
• Control: Spending limited to specific amount
• Privacy: Merchant never sees company card number or full details
• Compliance: Automatic policy enforcement

#When to Use Virtual Cards

Virtual cards are ideal for:

• SaaS Subscriptions: Monthly software charges (avoid recurring charges)
• Online Purchases: Amazon, Salesforce, etc. (single vendors)
• Vendor Trials: Free trials that require card (expires after use)
• Third-Party Vendors: Less-trusted merchants
• High-Risk Categories: Travel, entertainment (higher fraud risk)
• Contractor Payments: Paying 1099 contractors electronically

#Requesting a Virtual Card

#Self-Service Virtual Card

Employees can request their own virtual cards:

1. Open Light app or portal

2. Navigate to Cards > Request Virtual Card

3. Enter:

   • Merchant/Vendor: Who you're buying from (e.g., "Salesforce")
   • Purpose: What the purchase is for (e.g., "Software subscription")
   • Amount: How much you'll spend ($500)
   • Expiration: How long card should last:
     • Single-use (recommended)
     • 7 days
     • 30 days
     • 90 days
   • Notes: Any special instructions

4. Click Generate Card

Light instantly generates:

• Card Number: 16-digit number unique to this request
• Expiration Date: When card becomes invalid
• CVV: 3-digit security code
• Billing Address: For online checkout

5. Use immediately in online purchase

#Manager-Requested Virtual Cards

For policy control, manager can request on behalf of employee:

1. Navigate to Cards > Request Card for Employee
2. Select employee
3. Enter card details (same as above)
4. Light generates card
5. Card number is shared with employee
6. Employee uses for purchase

#Admin Virtual Cards

Finance can issue virtual cards for specific purposes:

1. Navigate to Cards > Create Virtual Card

2. Set card type:

   • Personal Use: Employee gets card for personal expenses
   • Vendor Payment: Paying a specific vendor
   • Subscription: Recurring service charge

3. Configure:

   • Amount: Spending limit
   • Expiration: Days until auto-expiration
   • Merchant Whitelist: Only usable at certain merchant (optional)
   • Assigned To: Who can use this card

4. Generate and distribute to employee

#Using Virtual Cards

#Online Purchase Checkout

1. Receive virtual card number from Light

2. Go to vendor website checkout

3. Enter card details:

   • Card Number: 16-digit number provided
   • Expiration: MM/YY format (e.g., 05/24)
   • CVV: 3-digit code provided

4. Enter billing address provided with card

5. Complete purchase

6. Card processes payment

Card information is never saved by the merchant (one-time use).

#Handling Subscription Services

For subscriptions where merchant tries to charge repeatedly:

1. Virtual card is set to single-use
2. First charge goes through
3. Merchant tries to charge again (auto-renewal)
4. Card is declined (number no longer valid)
5. Employee must:
   • Manually authorize renewal on company card, or
   • Request new virtual card, or
   • Switch to manual payment

Alternatively:

1. Generate virtual card with 30 or 90-day expiration
2. Matches subscription billing cycle
3. Card auto-expires at renewal (prevents surprise charges)

#Managing Virtual Cards

#Viewing Active Virtual Cards

1. Navigate to Cards > Virtual Cards

2. See active virtual cards:

   • Merchant: Who card is for
   • Amount: Spending limit
   • Used: How much has been spent
   • Remaining: Amount left
   • Expires: When card expires

3. Click to see details:

   • Full card number
   • Expiration date
   • CVV
   • Transaction history (if used)

#Limiting Virtual Card Scope

Restrict virtual card to specific merchant:

1. When generating card, set Merchant Whitelist
2. Enter merchant name (e.g., "Salesforce")
3. Card only works at that merchant
4. Declined if used elsewhere

Prevents accidental misuse.

#Cancelling Unused Virtual Cards

Cancel cards no longer needed:

1. Open card details
2. Click Cancel
3. Card becomes invalid immediately
4. Cannot be reused

Use if circumstances change and purchase no longer needed.

#Security Features

#Card Number Security

• Unique Number: Each virtual card has unique number (no reuse)
• Short-Lived: Expires after set period
• Non-Transferable: Card not usable by anyone except intended user
• Tokenization: Card details not stored by merchant (encrypted token used)

#Fraud Prevention

Light monitors virtual card usage:

• Spending Limit: Card cannot exceed authorized amount
• Merchant Restriction: Card only works at specified merchant
• Velocity Checking: Flags multiple transactions in short time
• Amount Checking: Alerts if unusually large charge
• Auto-Expiration: Card automatically expires, preventing misuse

#PCI Compliance

Virtual cards reduce PCI compliance burden:

• Merchant Never Sees Company Details: Doesn't see company card or payment method
• No Card Storage: Merchant cannot store number for future use
• Encrypted Transmission: Card details encrypted in transit
• Reduced Liability: Less sensitive data exposed

#Virtual Card Reconciliation

#Transaction Tracking

Virtual card transactions automatically appear in expense module:

1. Transaction posts immediately (within hours)

2. Shows:

   • Merchant: Where charge occurred
   • Amount: Charge amount
   • Date: Transaction date
   • Card Expiration: Which virtual card was used

3. Can be tracked and reconciled

#Expense Categorization

Transactions can be:

1. Auto-Categorized: AI assigns category based on merchant
2. Manually Categorized: Employee selects category
3. Approved: Manager approves through normal workflow
4. Posted: GL entry created based on category

#Cost Center Allocation

Track spending by cost center:

1. When creating virtual card, assign Cost Center (optional)
2. When card is used, cost center is automatically charged
3. Finance can track spending by cost center/department
4. Accountability is clear

#Approval Workflows for Virtual Cards

#Pre-Approval for Virtual Cards

For large purchases, require approval first:

1. Configure policy: "Virtual cards over $1,000 require approval"

2. When employee requests $2,000 virtual card:

   • Request goes to manager for approval
   • Manager reviews request
   • If approved: Card is generated
   • If rejected: Request is denied, no card generated

3. Prevents unauthorized spending

#Post-Transaction Approval

Even after card is used:

1. Configure policy: "Expense approval required"
2. Transaction posts to Light
3. Manager is notified and reviews
4. Manager approves or rejects
5. If rejected: Refund is processed

#Virtual Card Reporting

#Virtual Card Usage

1. Navigate to Reports > Virtual Card Usage

2. View:

   • Cards Generated: Total created
   • Cards Used: How many were actually used
   • Unused: Cards that expired without use
   • Average Amount: Typical virtual card spending
   • By Employee: Who uses virtual cards most
   • By Merchant: Most frequent vendors

3. Filter by date range or employee

#Cost Analysis

1. Navigate to Reports > Virtual Card Costs
2. View:
   • Processing Fees: Per-transaction cost
   • Total Cost: Cumulative fees
   • Cost per Transaction: Average
   • ROI: Fraud savings vs. fees

Use to justify virtual card program investment.

#Related Articles

• Issuing and managing corporate cards
• Apple Pay and Google Pay
• Setting up Light cards (KYC)