Before the pandemic, there was already a significant change and evolution in business and work — from the type of technologies available such as Cloud and Artificial Intelligence (AI) to the way people engaged within the digital ecosystem at work and how they digitalize their payment operations.
Companies focused on their digital transformation
With the COVID-19 crisis, we saw almost a decade of digital transformation and adoption for businesses compressed into less than two years. In 2020, 75% of companies had focused on their digital transformation, and two-thirds of them had increased their investments. The finance function is not left out either, and we are seeing the urgency to modernize and jump on the digitalization bandwagon.
A key reason for CFOs and their finance team to accelerate their digital transformation is largely a result of the economic and global health situation, which require them to simplify their management processes. In this context, CFOs see their work made easier, especially regarding financial performance management, consolidation, closing or even accounting reviews.
Data Visualization tools as essential part of finance department
Digitalization also helps with processing data and ultimately controlling expenses. But what we are referring to here is not keying data into excel spreadsheets but cloud-based data visualization tools, which is an easier way to analyze spending behavior. It is important to note that tracking your finances is one thing, but managing and visualising your data is just as important. In Jenji’s latest Global Expense Management Index, we found that the total number of expense reports generated in 2020 was reached within just one quarter in 2021. The number of users using digital expense management also increased by 95% in Q4 2021 compared to the same period in 2020.
Benefits of virtual payment cards
Another trend we see emerging to control and manage expenses is the increasing use of virtual payment cards, which has become a viable and secure alternative to traditional credit cards and can help businesses stay on top of spend management.
The benefits of virtual payment cards include streamlining operations and preventing excessive spending. For example, limits can be set in advance such that payments automatically decline if a vendor increases its prices significantly above the rate that has been put on a virtual card. Virtual payment cards also facilitate easier tracking and categorization for expense management. Employees can request access to funds before they are released to make transactions allowing the firm to mitigate fraud better.
The world is rapidly transforming, and businesses are faster and more agile at adapting to new technologies and are constantly seeking new ways to increase productivity. In today’s world, digitalization is seen as a ‘must-have’ rather than a nice to help, and virtual payments and data will continue to grow in significance.