Why U.S. Bank ditched plastic for its newest corporate credit card
Though mobile payments adoption hasn’t surged like contactless cards as consumers look for ways to minimize coronavirus spread, U.S. Bank is ditching plastic completely with its newest corporate card.
From provisioning to paying online and in stores, the U.S. Instant Card is going fully mobile with an app leveraging users’ mobile wallets in what the Minneapolis-based bank said is an industry first.
“This is a virtual commercial card that can be pushed into a mobile wallet like Apple Pay or Google Pay, a new use case that improves on traditional virtual cards,” said Bradley Matthews, U.S. Bank’s senior vice president for the corporate payments group.The solution enables managers to extend temporary use of a commercial card to almost anyone—an employee, contractor or visitor—through a lightweight connection that requires only the recipient’s email and mobile number, according to Matthews.
Managers can set restrictions for Instant Card payments around the amount and the eligible time period for the spending.
“We wanted to eliminate the need for people to use their personal credit cards to cover miscellaneous purchases, and we made it as streamlined as possible,” Matthews said.
To connect to Instant Card, the recipient must download the app, link to the card via email and verify receipt of the card with a code sent to their mobile device.
Available now for use only with Apple Pay, the Visa-branded Instant Card will be compatible with Google Pay this summer, Matthews said.
Unlike a P2P payment that requires only a mobile number, using Instant Card takes a couple more steps, including requiring the recipient to download an app. But Matthews said that’s fewer steps and less integration than what’s usually required for a commercial credit card.
“There’s no back-end integration, and while Instant Card has the option to link to corporate expense management systems, it’s not necessary,” he said.
Instant Card also stands apart from the growing number of expense-management services that are primarily designed for employees, Matthews said.
Instant Card use cases include covering sundry expenses for non-employees, including job interviewees, board members, temporary workers and guests.
The fact that mobile payments adoption still is no more than 10% at best in the U.S., the long-term outlook for the technology is more promising, according to Matthews.
“It’s true that mobile payments have taken off slowly, but we’ve long believed there will be a tipping point where mobile payments will begin to grow and we want to be positioned for that,” he said.
More than half of merchants currently accept mobile NFC payments and higher numbers of online merchants do, but if a merchant isn’t Apple Pay-enabled, users may input the account number manually at payment terminals, Matthews said.
“We feel confident that Apple Pay and Google Pay are widely enough available at merchants so it won’t be inconvenient," he said. "But if they need to enter the account number, they can easily obtain it from the app, which will be similar to the way many virtual cards operate now.”