The digital backbone of global commerce is increasingly being bent by financial technology (fintech) innovators. They are working with card networks and card issuers and using their own start-up companies to identify opportunities to add value, increase revenue, and staunch blood flow from fraud and human error.
They are simultaneously competing against and working with the traditional commercial card industry to challenge the notions of what a commercial card program can be, and what problems it can solve.
Fintechs have brought the commercial credit card sector a range of innovative and category-enhancing products. From virtual cards that enable platform payment transactions for the food delivery business to embedding payments in vertical software-as-a-service (VSaaS), fintechs are stimulating card use even as they help merchants drive down the costs of those payments.
Fintechs Shake Up Commercial Card Market
And the fintech innovators disrupting the commercial card segment are not solely those in the payments sector. In addition to payments firms modifying their products to address the unique technologies underlying mobile and online transactions, innovators are emerging to meet the demands of novel or COVID-transformed merchant categories such as take-out and grocery delivery, ride sharing services, and personal shopping services.
Traditional issuers are also under pressure from the expectations they themselves helped create. In their efforts to acquire and retain consumer customers, financial institutions have created a baseline of expectations for intuitive and robust use of apps and the integration of multiple product accounts in a single interface. Expectations that commercial financial services should be as nimble and user-friendly as their consumer counterparts are bubbling up from consumers to their day jobs as business travelers and finance department employees.