As businesses have moved away from legacy spending methods like ACH or paper checks, the virtual credit card has risen in popularity. 

Today, we’re taking a look at the state of virtual cards for business in 2020.

What is a virtual credit card?

When you get a new credit card for your business, you get a single 16 digit number on a piece of plastic. With virtual cards, you can create as many unique card numbers as you need and they exist only digitally. 

Each unique 16 digit virtual card number can be used for one-time or recurring purchases without exposing the original physical card data. By creating a new virtual card number, your business gets better security and control.

Physical credit cards vs. virtual credit cards

While physical credit cards still have their place, the trends show that virtual cards are on the rise. 

At the start of 2020, physical cards were still favored for the majority of transactions. However, when COVID-19 hit in March, virtual card usage climbed to 50% of business credit card transactions. Since then, virtual cards have maintained the majority usage.

DATA: Virtual card vs physical card transaction counts in 2020

Virtual Physical
January 38.13% 61.87%
February 37.86% 62.14%
March 50.00% 50.00%
April 63.41% 36.59%
May 65.28% 34.72%
June 58.56% 41.44%
July 62.59% 37.41%
August 63.92% 36.08%
September 67.30% 32.70%
October 54.89% 45.11%
November 61.21% 38.79%
December 56.55% 43.45%

*Based on Divvy spend data

Year over year, the use of Divvy virtual cards increased by 283% in 2020. While virtual card usage was already on the rise, the move to remote work necessitated by the coronavirus crisis had a major impact on this shift. 

(Fun side note: This observation is reflected in Google Trends data, where searches for the term “virtual cards” spiked in March and April of last year.) 

When we compared physical vs virtual card data for 2019, we found that the usage varied by the merchant. For example, Google Ads purchases were made almost exclusively with virtual cards, while hotels were still booked more often using physical credit cards. As business travel purchases decreased significantly in 2020, the rise in virtual card usage could also be a result of the changes in the types of purchases that were made (due to budget adjustments). Perhaps businesses were not only making purchases remotely, but were purchasing digital items (like software) more often than they were purchasing things like hotel reservations.  

Recurring vs. one-time use cards

With Divvy virtual cards, customers have the option to create one-time use “burner” cards or recurring subscription cards. Burner cards are typically utilized for single-use budgets or one-off projects. 

Of the virtual cards created in 2020, only 1.5% were one-time use. The majority of Divvy customers choose to use virtual cards for ongoing purchases and managing recurring bills (like monthly utilities or SaaS subscriptions). 

However, customers see the value of both. One recent NPS comment read: “The security features that allow you to generate unique one time cards or cards for a specified vendor is really helpful.”

Virtual cards for vendor management

Using virtual cards to pay specific vendors or manage subscriptions helps you to plan your spend—tracking every payment in real-time and seeing which budgets are recurring monthly.

Top vendors for virtual card payments

As expected, our research shows that virtual card payments tend to be made to digital vendors, but there are also outliers. 

To track down the top vendors for virtual card payments in 2020, we started by grouping like purchases under the “cleaned” merchant name and then ranking them by transaction count. (For example, “Amazon” purchases would include both Amazon Web Services and Amazon Marketplace).

The top vendors paid for using virtual cards were probably what you’d identify as the top vendors for any corporate card purchase: 

  1. Facebook
  2. Amazon
  3. Google 
  4. PayPal
  5. USPS

Considering how much (and how often) businesses spend on Facebook and Google Ads, these first few contenders didn’t surprise us much. We were surprised, however, to see USPS in the list—since it is typically thought of as a non-digital vendor.  

We opted to remove the “cleaned” merchant grouping and found the results varying a bit more.

DATA: Top 10 vendors who were paid with virtual cards most often (2020)

  1. USPS
  2. Uber
  3. GoDaddy
  4. Apple
  5. Target
  6. Amazon web services
  7. Microsoft advertising
  8. QuickBooks Online
  9. Zoom
  10. Adobe creative cloud

*Based on Divvy spend data

While we expected Zoom and Amazon to be listed in the top digital vendors from 2020, USPS was a new contender. USPS purchases (including stamps, change of address, and Click-N-Ship) showed up multiple times in our top vendors for virtual card purchases. In 2019, USPS didn’t show up anywhere on our list of purchases made with virtual cards. Perhaps the post isn’t the first thing you’d think of as being impacted by the coronavirus, but our data shows that the move to remote work impacted the way businesses manage their mail. 

(Google and Facebook Ads likely didn’t show up in this top 10 list because their “merchant names” vary more than other vendors.)

These two lists were ranked by the number of transactions each vendor had. When we adjusted the list by the amount spent per vendor in the year 2020, results shifted a bit: Amazon Web Services scored the top spot by a long shot.

Top industries with virtual card spend

Industry spend followed similar trends, with the highest virtual card transactions made by companies in the Media, Technology, and Internet industries. However, we also found that more brick-and-mortar and institutional industries have been embracing virtual cards as a means of managing expenses. 

In 2020, Hospitality companies and K-12 schools were in the top 10 virtual card spenders.

DATA: Top 10 industries who spent with virtual cards in 2020

Industry Cleared Transaction Count
Media 2,658,785
Internet software and services 565,343
Professional services 553,275
Consumer goods 290,395
Technology hardware 184,043
Diversified consumer services 98,030
Hospitality 96,110
K-12 schools 91,701
Utilities 81,154
Advertising  71,829

*Based on Divvy spend data

Virtual card use by location

Virtual cards are used in every state to help companies spend smarter. In California alone, virtual cards were used for 1.8 million business transactions in 2020. 

When we looked at 2019 virtual card data, 28 of the 50 states had Amazon as their most popular online vendor.

Benefits of virtual cards for business

More and more businesses are opting for virtual cards to manage their finances. In 2020, out of the total number of Divvy cards issued, 93% of those were virtual cards. We expect this trend to continue in 2021, especially considering the growing benefits of using virtual cards for business

These benefits include:

  • Subscription management: By creating a unique virtual card number for each recurring subscription, you can use card limits so you don’t miss vendor payments or get charged extra either.
  • Fraud prevention: In the event of a data breach, your physical credit card information is protected. 
  • Easy cancel: Freeze or delete virtual cards on demand and don’t wait for days for your new credit card to arrive. 
  • Spend limits: Tie virtual cards to company budgets so no overspending can occur. 
  • One-time use: Create temporary virtual cards for one-time use, budgets with an expiration date, or projects with limited spend. 
  • Instant visibility: See every online purchase as it happens and upload a digital receipt right away. 


Marc Balcke, controller at Noom, put it this way: “With Divvy virtual cards, there is less likelihood of fraud and incidents like card loss will only have minor implications. For me, I feel a lot more comfortable now in terms of controls and security of our credit card numbers.”

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