Virtual Cards for Business Spending: Everything You Need to Know

By Haley Davidson

Founder & Content Strategist, Gaia Content

Virtual debit cards make business spending more convenient, secure, and transparent. 💳 They can even help you simplify employee expense management, streamline financial operations, and reduce the risk of fraud. 🙌

Wondering if you should add virtual cards to your business’s “wallet”? In this guide, we’ll help you understand what a virtual debit card is, how they work, and the many benefits for small business owners.

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What is a virtual debit card?

A virtual debit card is a digital version of a traditional, physical debit card. That means it's not a tangible card and doesn't exist in a physical form. Instead, it's a set of card details—including a card number, expiration date, and CVV—which you can use to make online payments. 💻

Like most physical cards, your virtual debit card can be added to Apple Pay, Google Wallet, and other digital wallets. The difference? When you add your physical card to your mobile wallet, you're just creating a digital version of that card. The card information is exactly the same—so if your physical card is compromised, so is the version in your phone.

By contrast, virtual debit cards aren't linked to a physical counterpart. That means they're less vulnerable to loss, damage, and theft. 🔐 This can give small business owners an extra sense of security and peace of mind—you'll always know exactly where your virtual card is.

What about virtual credit cards? 🤔

Unlike debit cards, virtual credit cards extend a line of credit to your business. Each one has its own unique credit card number and in most cases, they aren't linked to a physical card.

While corporate credit cards offer some unique benefits—like increased spending power and cashback rewards—they can be a risky choice for growing businesses. If you don't pay your credit card bill in full each month, you could be charged interest and late fees. 💰

Virtual debit cards are much simpler: funds are taken directly from your business checking account when you make a purchase. This can help companies avoid overspending and unnecessary debts.

Can businesses use virtual debit cards?

Yes! Businesses of all sizes can use virtual debit cards for software subscriptions, vendor payments, and (business-related) online purchases. You can even use your virtual card for in-store purchases, as long as the retailer accepts digital payments. 📱

When you open a business bank account, you should be able to issue virtual debit cards for your employees—as well as your own business expenses. 💼 Some banking platforms even offer additional features to help you manage spending and cash flow.

For example, Relay (that’s us! 👋) is an online business banking platform that allows small business owners to instantly issue 50 virtual debit cards. Then, you can set spending limits for each card and get real-time visibility into all transactions. 🔎

It’s important to note that many traditional banks won't issue your business a separate, virtual debit card. They might allow you to add your physical debit card to your digital wallet, but the card details will be the same.

⭐️ Looking for a virtual card issuer? Check out our guide to the best banks with virtual debit cards for businesses.

Benefits of virtual cards for businesses

Research from PYMNTS shows that 32% of companies already use virtual cards for B2B payments. 💳 It’s no surprise that so many businesses are turning to virtual cards—they’re incredibly convenient and often come with advanced security and spend management features.

Let's break down the top benefits of using virtual debit cards for your small business.

😎 Available immediately

Instead of waiting days to receive a new card in the mail, you can issue a virtual debit card instantly. ⚡️ 💳 This is super convenient since you can quickly give yourself (or your employees) access to funds when needed.

For example, imagine you need to replace a piece of equipment unexpectedly. Unfortunately, your physical debit card just expired, and you're waiting for a new one to arrive in the mail. 😩 By instantly issuing a new virtual debit card, you can purchase the equipment right away—and never miss a beat in your business operations.

🔐 Advanced security features

Traditional, physical debit cards are vulnerable to theft and loss. That's where virtual cards have a big advantage. 🙌 Most virtual cards come with security features like:

  • Advanced card controls, allowing you to instantly freeze or cancel debit cards with suspicious activity

  • Spending limits, so you stay on budget and control how much employees spend

  • Transaction notifications, so you always know when and where your cards are being used

  • The ability to issue multiple cards, so you can reduce risk if one card is compromised—some providers even allow you to issue single-use cards

Virtual cards can even protect your business from fraud. For example, Relay's advanced card controls allow you stop stop fraudulent activity as soon as it's identified. 🚫

These card controls saved the day when business owner Madeline discovered that an employee was committing fraud. 😬 If her company relied on physical debit cards alone, it could've taken days to respond to the situation—leaving the business's assets at risk.

Comparing the security response rate with Relay vs. traditional banks

Instead, Madeline was able to use Relay’s mobile app to freeze the business's virtual cards—and issue new ones—in a matter of minutes. ⏰ Company operations went uninterrupted, and Madeline was even able to pay for a business dinner thanks to her new virtual card and Apple Pay.

💸 Improve cash flow management

Most virtual card issuers allow you to create multiple cards for different employees, spending categories, and projects. 💳 Then, you can set spending limits for each card based on your business budget. This makes it easier to control employee spending and manage cash flow.

For example, you can issue cards to your employees with a limit for meals and entertainment. 🍕 Or you could give yourself a card specifically for software subscriptions or vendor payments. 💰

Virtual debit cards also give you more visibility into spending. Instead of sorting through hundreds of transactions linked to one physical card, you'll be able to get a clear, organized view of spending across multiple cards.

This will help you understand who made which purchases, when, and for what purpose. At a glance, you can make sure funds are being used for the right things and spot any suspicious or unusual activity.

When you're crystal clear on spending, you can make more informed business decisions, build better budgets, and save on unnecessary expenses. The result? You'll improve your business's financial health and reach your financial goals faster. 🤩

🧾 Streamline back-end business operations

Virtual debit cards can simplify complicated, back-office business processes—and save your company lots of time, money, and energy.

Here are a few business operations that virtual debit cards help streamline:

💰 Employee reimbursement: Virtual cards basically eliminate the need for employee reimbursement (especially for smaller businesses). Each employee can have their own virtual business debit card with pre-set approvals and limits, allowing you to maintain complete control over spending.

📊 Bookkeeping: Most banking platforms automatically categorize virtual debit card transactions. That means you can speed up bookkeeping, simplify account reconciliation, and reduce the risk of human error.

💸 Bill payments: With virtual cards, you can pay bills anytime, anywhere, without worrying about late fees or lost checks. Some virtual card providers even allow you to automate your accounts payable process—so you never miss a deadline again.

🔄 Vendor management: Businesses can assign individual virtual cards to each vendor or service provider. This makes it super easy to track expenses and manage payments. Plus, if a vendor's services are no longer needed, their virtual card can be canceled instantly—helping you avoid lingering, unauthorized charges.

Use cases for virtual business debit cards

Whether it’s credit or debit, virtual business cards offer a convenient and secure payment solution for any company. Here are a few more examples of how businesses can manage cash flow—and make their lives easier—with virtual cards. ⬇️

  • Advertising spend: Marketers can issue different virtual debit cards for each advertising platform they use (like Facebook, YouTube, and Google Ads). Then, they can track spending at a glance, instead of sifting through a single card’s many transactions.

  • Remote team management: Small business owners can issue virtual cards to their remote team members, allowing them to easily purchase office supplies. This removes the need for reimbursements and can simplify spend management. 🙌

  • Travel expenses: You can issue employees virtual debit cards specifically for business travel. ✈️ Then, they can use the same digital card for in-person purchases, like meals and transportation. Ultimately, this can cut down the time your team spends submitting expense reports and processing reimbursements.

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No account fees or minimums; 20 checking accounts; 2 savings accounts with 1.00%-3.00% APY; 50 virtual + physical debit cards. Open account 100% online.

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Relay: Instantly issue 50 virtual cards for your business

With Relay, small business owners can open 20 no-fee business checking accounts and issue 50 virtual or physical Visa debit cards. 🙌 💸 Then, they can set spending controls, manage employee expenses, and even automate accounts payable—without the hassle of leaving the platform. 

Relay is truly an all-in-one banking solution, designed to meet the unique needs of small businesses. Ready to get your virtual debit card? You can sign up for Relay here! 😎