In today’s world, it is hard to find a business that does not rely on at least one software service to conduct its operations. Whether you have a physical product, a digital product, or a service business, having software subscriptions are part and parcel of managing the company.
These SaaS (software as a service) subscription tools are often tough to keep track of if there are too many of them. From handling the expenses to maintaining a record of active and inactive subscriptions, organizations end up needing to implement subscription management software to manage all the other software tools.
What are SaaS subscriptions?
A SaaS subscription is essentially a business model where software-providing companies sell their software tools to other businesses on a subscription basis. Generally, SaaS companies set monthly, quarterly, or yearly subscription fees for customers to pay which are always much lower than a one-time fee for buying a software service.
This model is helpful for users as they get to try out a software tool for a small period of time without committing a huge sum of money. This also helps the SaaS provider to get constant feedback from users and a recurring stream of income rather than a single payout.
What is subscription management?
Subscription management is basically techniques, methods, and tools you use to manage all your software subscriptions. For a business that has multiple SaaS tools that they use on a daily basis, using subscription management software is a great idea. This might often come in the form of an expense management tool that lets you manage separate software expenses that also ends up keeping a track of active and recurring subscriptions.
Why should you have a subscription management system in place?
- Convenience – It will be difficult to keep track of all the subscriptions when each team in your business has a lot of SaaS tools that they use daily. It becomes challenging to keep track of everything for your finance team if the information regarding all of this is scattered and not centralized.
- Lack of clarity – When a business uses a single credit card for company expenses, it might lead to confusion as all purchases are being made from the same card and there is a lack of visibility on who is spending where.
- Better tracking & verification – Having a single platform to manage all subscriptions make payment reconciliation easier.
● Stop capital leakage – While a singular SaaS fee for a tool might not seem like a lot, if active services that are not being used aren’t closed, it will lead to slow leakage of money that will compound over time. To prevent this wasteful SaaS spending, implementing SaaS subscription management software is necessary.
- To prevent excessive budget cuts – As more and more amounts are spent on SaaS subscriptions, especially the ones that you don’t need but are not kept in check, it may result in budget cuts due to inefficient utilization.
What is a virtual card and how does it work?
A virtual card is basically a payment card similar to a credit or debit card. The difference is that it is only usable for online payments and is not physically present anywhere. There are many banks and FinTech companies that offer their customers virtual cards for managing business expenses.
A virtual card has a string of numbers as the card number similar to a physical card, an expiry date, and a PIN that authenticates a transaction. The benefit of using such a card is that it cannot be stolen, and even if the details are somehow leaked, they can easily be frozen or blocked online. Plus, these cards are not directly linked to a bank account, so they are not traceable back to a source which fraudsters can steal money from.
Can virtual cards be used to manage SaaS subscriptions?
Virtual cards are great tools for SaaS subscription management as they not only act as controls for keeping expenses in check but also double down as subscription management software for each SaaS tool individually thanks to the capability of many providers to create unlimited virtual cards on their platforms.
H3: Benefits of virtual cards for managing SaaS subscriptions
Real-time visibility – Using a virtual card, you are constantly able to see the spending that is happening on the dashboard of the virtual card provider. This gives you real-time visibility of all the expenses that are happening and lets you make quicker decisions. Rather than having to wait for the statements you receive each month when spending through a physical card to see how much is being spent in different places, a virtual card gives you access to this information at your convenience and lets you manage subscriptions better.
- Real-time sync of transactions – Virtual cards are usually part of a larger system such as expense management software. These software tools have many capabilities including the ability to sync all expense transactions with accounting tools in real-time so that the company books are updated.
- Limit spending – Human error or carelessness is one of the main reasons for inefficiency. An employee might forget to cancel a subscription when they do not need it anymore. This common error can lead to money slowly leaking out of your company budget each month without it seeming to be a problem. The beauty of virtual cards is that you can set custom expiry dates for each card. So if you want to use a particular software for only 6 months, when issuing a virtual card, you can set the expiration date of that card for 6 months from the day you purchase the subscription.
- Rewards for each payment – Many virtual card providers help businesses benefit from using these cards through special reward programs and also offer attractive rates of cashback for spending through them. This makes virtual cards not only a great tool to manage SaaS expenses but also to earn money that can be reused for paying subscriptions in the future.
- Prevent fraud – One of the major plus points of using a virtual card is the enhanced security that it offers. A virtual card number is not directly linked to a bank account. This safeguards your money from being stolen in case your virtual card details are compromised online. Add to that, you can easily and instantly freeze your virtual cards temporarily or block them permanently through your virtual card provider’s online dashboard.
- Prevent duplicate payments – Last but not least, virtual cards help you prevent duplicate payments to a subscription service by allowing a user/admin to see all the current subscriptions in one place. For example, an employee wants to purchase LinkedIn’s Sales Navigator, but another employee in the organisation already has bought this subscription service. Without a centralised platform, the employee wouldn’t know this and would end up buying another subscription causing a duplicate payment.
The rise of digital inclusion & SaaS services will make virtual cards a necessity for businesses
With the constant rise of digital inclusion within businesses, you will see a steady increase in the use of SaaS services throughout all sectors and industries. This will make it inevitable for companies to adopt and start using virtual cards from different providers in India to manage all their online subscription expenses and make corporate spending a more efficient process overall for the business.