Corporate cards and spend management, from tradition to innovation: Mesh Payments interview

What can you tell us about the corporate card market size, growth, and features? 

Let's start with the growth picture, and then I'll address the question of market share. Spend management is one of the fastest-growing markets in the fintech space. A 2020 IDC survey confirmed that 60% of respondents were discussing intelligent spend management platforms with a technology vendor. This interest underscores the rapid pace at which the market is moving away from fragmented, legacy solutions that businesses use to manage spend today. 

Corporate cards have always been at the heart of spend management. Virtual payment cards are becoming the de facto choice for B2B payments. A new study by Juniper Research has found that the global value of virtual card transactions will reach USD 6.8 trillion in 2026, from USD 1.9 trillion in 2021. 

When Mesh looked at what finance teams needed from their corporate cards, the answer was easy-to-provision virtual corporate cards that could be added and suspended in real-time for more control and security. On top of this, we understood that customers still need a solution for payments in the physical world, which was the driving force that led us to launch our Visa Plug & Pay card. This is a first-of-its-kind solution that lets users link a physical card to any of their virtual cards (cards by use case or employee) on the Mesh platform. This is a paradigm shift for finance – away from manual and towards better control and visibility. 

You mentioned remote workforces. What is it about this model specifically that is driving the growth of spend management platforms like Mesh?

The rise of remote work accelerated the demand for speed and transparency inside finance organisations. In conjunction with the pandemic-accelerate spike in SaaS subscriptions, spurred on by distributed workforces and their many workplace tools and subscription needs, it's become all but impossible for businesses to manage corporate spend with outdated and pre-pandemic legacy finance and accounting systems. 

Spend management platforms can help businesses audit and optimise subscriptions and licences by providing unparalleled visibility into spending from one central platform. Additionally, it allows companies to eliminate risky and difficult to control processes from their workflows. One example is the ‘miscellaneous’ corporate credit cards that often float between employees without any controls.

You don't think traditional corporate cards can adapt to this new environment?

No. Traditional corporate cards were not built with the needs of a modern workforce in mind. They were often reserved for management only and were cumbersome to track and manage. For example, in most companies, employees typically have had to cover travel expenses upfront from their own pockets and then submit for reimbursement after the trip. While they wait for reimbursement, they are often left with serious expenses pending on their personal credit cards – business travel is not cheap.

Mesh eliminates this friction completely. The flexibility of a spend management platform makes it much easier for companies to give employees specifically provisioned cards that are tailored for individual use cases or employees. This eliminates the burden and hassle on employees to front expenses and also provides much more control and visibility for finance teams. It's a win-win.

Please run us through the impact of losses and time spent by finance teams trying to fight against corporate card abuse and fraud. 

Card fraud over the next decade could cost the industry a collective USD 408.50 billion in losses globally, according to an annual report from the industry research firm Nilson Report. And while fraud and abuse of cards and corporate expenses can be costly for organisations – the impact of this type of fraud on external reputation and credibility far outweighs the actual financial losses.

A study by AppZen reported that expense reimbursement fraud comprises 17% of all business fraud in this country, costing US businesses billions of dollars per year. Unfortunately, too much of this abuse is due to legacy corporate card processes and outdated reimbursement policies that create bottlenecks and lack visibility and oversight. The key to reducing fraud and abuse is to give finance teams visibility and control at a granular level for each corporate payment in real-time. That's something that siloed legacy systems can't provide.

How does your solution help mitigate the issues of fraud and abuse you identified?

Let's start with our physical card solution. One of the most common sources of abuse is the loss or theft of the card or having the card number copied from the card. Plug & Pay is a numberless card, so no number can be copied. But it goes far beyond that.

If the card is compromised in any way, the finance manager can simply link a new virtual card to the physical one. Additionally, finance managers have full control, allowing them to disable the card, change its pin code, or swap the virtual card remotely all from the Mesh platform.

But that's just the threat of theft or the number being compromised. Abuse can also come internally from employees who have access to the card for legitimate reasons.

Fortunately, Plug & Pay makes it easy for finance managers to stay on top of their budgets since they can pre-approve the virtual cards that employees use, or remove a card from an employee's control with just a click. 

All of this applies, obviously, to virtual cards as well, but we provide additional levels of control that can take abuse prevention to another level. For instance, with Mesh, it's possible to lock a card to a specific vendor. This means there is no way to use the card to pay for anything else. So even if all the details are somehow stolen, the card can only be used for the purpose the finance team created it for.

What can be done to prevent this type of fraud and what will it take to implement it?

In my opinion, there is no turning back to pre-pandemic finance management. The future is financial automation. Reliance on company policies and building a culture of compliance is not enough. CFOs and finance managers know they need more visibility and control to manage spend in a distributed workplace fueled by the new business models. 

Covid changed the way finance teams operate forever and really shifted the corporate structure away from travel and expense (T&E) and towards subscription payments. Spend management software can eliminate manual review of expenses, reduce mistakes, and generate valuable data for comparison and analysis. These benefits enable finance teams to run reports, flag suspicious transactions, and better control financial data in real-time. 

About Oded Zehavi

Oded Zehavi is the co-founder and CEO of Mesh Payments, as well as a board and advisory board member for several international fintech companies. Previously, he served as Payoneer’s Chief Revenue Officer, as well as PayPal’s Business Development Director, where among other responsibilities, he led the inception of PayPal’s services in the Middle East and Africa. He has extensive experience in leadership roles at various technology, banking, and software companies, focusing on sales and customer relations.

About Mesh Payments 

New York-based Mesh Payments is the spend management platform created by fintech veterans and purpose-built for the way finance managers work. The Mesh platform powers some of the world's fastest-growing brands, including Monday.com, Hippo Insurance, Sezzle, Riskified and Snyk. Mesh is not just a better corporate card. Mesh helps finance teams take control of their spend, automate key tasks to accelerate monthly reconciliation, and gain key insights into their spend in real-time.