SEATTLE, Feb. 08, 2019 (GLOBE NEWSWIRE) — According to Coherent Market Insights, the global commercial or corporate cards market is projected to exhibit a significant CAGR of 7.3% over the forecast period (2018 – 2026).
Key Trends and Analysis of the Commercial or Corporate Cards Market:
Increasing business travel spending and rising trend of digitalization are major factors driving growth of the market. Commercial or corporate cards are expected to be among the fastest-growing products for banks, as commercial card spending is increasing. By 2020, it is expected that spending levels on commercial or corporate cards will increase by 71 percent from 2013 and the compound annual growth rate will reach 8%. Increasing spending level on commercial or corporate cards is expected to increase their adoption and in turn, is expected to result in wider acceptance among merchants. Moreover, government regulations to reduce interchange fees will also help in increasing acceptance of commercial or corporate cards among merchants. For instance, in August 2018, the Canadian Finance Ministry announced a reduction in interchange fees to help businesses grow and invest more money in expanding their footprint. Enterprises that do not invest in commercial or corporate cards are likely to fall behind their peers in such a competitive market.
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Banks are often facing the issue of maintaining a balance between ease-of-use, ease-of-access, and stringent security measures with respect to commercial or corporate cards. More and more cards have started embracing fingerprint authentication and they are gradually phasing out facial recognition security features. Moreover, the process of consumer authentication through biometrics has also gained traction in the recent past. The integration of these mainstream security features into the commercial or corporate cards will make the payment process seamless and easy to use. For instance, in order to introduce and speed up the process of biometric authentication feature in their cards, Mastercard, in May 2018, introduced a new solution known as remote enrollment. This solution enabled the end users of next generation biometric payment cards to register their fingerprint data on their credit cards from their own homes without having to visit the bank for registering their fingerprints. The introduction of such features in credit cards is being extended to commercial or corporate cards as well.
Moreover, the use of artificial intelligence is gaining popularity in the era of automation, as many organizations are making use of machines to perform repetitive tasks, in order to minimize resource costs and optimize the use of available manpower. This factor has a positive impact on the financial transactions performed by the company as well. The amount spent by these companies (automation focused companies) on technology acquisition or maintenance of such equipment will increase. Commercial or corporate cards are deploying artificial intelligence systems, in order to track and store the number of transactions carried out using a card. The data collected is used to provide information regarding the amount spent using such cards and evaluate the spending pattern. The obtained information is very important to commercial card providers, as patterns in spending and efficiency can potentially deliver valuable insights, which can be used by the companies to improve their financial health.
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Key Market Takeaways:
- The market is expected to witness a CAGR of 7.3% during the forecast period (2018–2026), owing to increasing focus by corporates to optimize working capital
- Europe held the second dominant position in the market in 2017 and is expected to witness significant growth during the forecast period. Increasing number of corporate card service providers in Europe is one of the major factors driving growth of the commercial or corporate cards market in this region. For instance, AirPlus International, a global provider of payment or billing solution for business travels, expanded its product range by offering European corporate cards in June 2018. By the end of 2019, the company will provide its products in 18 other European countries. Similarly, UnionPay, a China-based payment platform provider, is also planning to enter the European market by December 2018. Moreover, increasing number of card users for payment transfer is also a major factor driving growth of the market in Europe.
- Some of the major players operating in the global commercial or corporate cards market include AirPlus International Ltd., Amazon.com, Inc., American Express Company, Bank of America Corporation, Citigroup, Inc., JP Morgan Chase & Co. Inc., U.S. Bancorp, Wex Inc., Wells Fargo & Company, Corporate Spending Innovations Enterprises, Inc., NGC US, LLC, and Bank of China Limited
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