AP efficiency in construction: Build a strong financial foundation

When it comes to running a successful construction business, you know that having the right tools and a solid plan is essential for getting the job done right. 

From blueprints to the final nail, every step requires precision and organization. But while most construction companies are pros when it comes to physical tools, some are still relying on outdated payment methods that could be holding them back. 

That’s where virtual cards come in. They’re the modern accounts payable (AP) solution and a step towards building a strong financial foundation for your construction business.

Streamlining payments for better project management

Imagine trying to build a house without a proper framework. The structure wouldn’t last long, right? 

The same goes for your construction company’s AP process. Without an efficient and organized way to manage payments, your business could face delays, errors, and cash flow problems that can slow down projects or cause unnecessary stress.

Virtual Cards are a rising payment solution in the construction industry

Virtual cards are becoming an increasingly popular payment method in the construction industry, helping businesses stay competitive with faster, more efficient payments. For contractors, they offer a powerful way to improve cash flow while keeping payments simple, fast, and secure.

A recent PYMNTS Intelligence report found that 46% of construction firms use virtual cards primarily for payables. It also revealed that 98% of mid-sized construction firms rely on working capital solutions, such as virtual cards, with more companies using them strategically for growth than in previous years.

Before we dive into how virtual cards can benefit your business, let’s start by understanding what they are and how they work. 

What Are Virtual Cards?

Virtual cards are a digital version of a traditional credit or debit card, created for a specific transaction or set of transactions. These single-use or limited-use cards have a unique number, making them highly secure and customizable to your business’s needs. For contractors, virtual cards offer a simple, fast, and secure way to make payments, manage expenses, and improve cash flow.

The process behind virtual cards is straightforward:

• Card creation: A virtual card is generated with a unique, single or limited-use card number. Customize your cards with controls such as a spending limit and an expiration date. You can even specify which merchants it can be used with.

• Transaction: Once the virtual card is generated, it can be used just like a traditional card for online payments or purchases. The recipient (usually a supplier or vendor) processes the card as they would any other credit or debit card.

• Security and flexibility: The card number is typically valid for a single transaction or a limited period of time, which significantly reduces the risk of fraud. Since you have full control over the card’s usage, you can easily limit how much can be spent and where the card can be used.

• Tracking and reporting: Every virtual card transaction is tracked and recorded, giving you full visibility into your spending. You’ll know exactly who used the card, where it was used, and for how much. This level of detail allows for better control over expenses and simplifies reconciliation for your accounting team.

Virtual cards provide the framework to keep your projects on track. Here’s how:

• Quick payments to suppliers: Virtual cards offer quick and secure payments to suppliers, helping you avoid delays that could throw off your timeline. When you need materials on-site fast, a virtual card allows for instant payments, ensuring your project doesn’t grind to a halt because of payment delays.

• Improved cash flow management: Managing your cash flow is like managing your supply chain – everything needs to be in the right place at the right time. Virtual cards help contractors control spending by setting limits and expiration dates on each card, so you know exactly where your money is going and can avoid unexpected overspending.

• Eliminating manual processes: Just like you wouldn’t manually haul heavy materials when you have a forklift available, virtual cards eliminate the need for manual payment processing, reducing human error and cutting down on paperwork. With automated payments, your accounts payable (AP) department can focus on higher-level tasks rather than chasing down invoices.

Securing your payments

Security is a top concern for companies across all industries, but especially in construction where dealing with large sums of money is common. With traditional payment methods like checks or wire transfers, there’s always the risk of fraud or misplaced funds. But virtual cards provide a level of security that traditional payments can’t match. 

Flexibility for every project

Deloitte’s 2025 Construction Industry Outlook shows that growth comes from embracing change and new technology. Staying flexible with the right set of tools lets businesses scale projects smoothly rather than scrambling to keep up with demand.

Just like every construction project is unique, so are your payment needs. Virtual cards offer the flexibility to scale up or down depending on the size and complexity of your projects. Whether you’re managing a small residential build or a massive commercial project, virtual cards can be customized to fit the bill.

Here’s how virtual cards provide flexibility:

• Multiple cards for multiple projects: Instead of using one corporate card for all expenses, you can issue different virtual cards for each project or department. Each card is responsible for its own set of expenses, making it easier to track spending and manage budgets.

• Setting limits for each card: You wouldn’t give your team unlimited access to materials or equipment, and the same should go for spending. With virtual cards, you can set individual limits for each card, ensuring no one goes over budget.

• Adapting to changing needs: Just as you need to adapt to changing plans on a job site, virtual cards offer flexibility. Need to adjust spending limits or extend a card’s expiration date? No problem. Virtual cards can be modified quickly to meet the needs of your business as projects evolve.

Reporting and insights for future projects

The final step in any construction project is the finishing touches that make everything come together. For your finances, this means reporting and insights. Virtual cards provide detailed reporting on every transaction, giving you a clear picture of where your money is going. This level of insight helps with budgeting and understanding your overall financial health.

With virtual cards, you’ll have access to:

• Detailed transaction reports: Virtual card transactions are tracked and recorded, providing a clear audit trail. 

• Spend monitoring: You can monitor spending as transactions occur, allowing you to make adjustments as needed.

• Improved budgeting for future projects: By analyzing past spending data, you can improve budgeting for future projects. Virtual cards give you the data to make smarter financial decisions moving forward.

In the construction industry, having the right tools and a solid foundation is key to success. Virtual cards provide a modern, efficient, and secure way to pay and manage your business’s finances.

For more insights and updates on corporate payments, check out:

• Your guide to virtual card rebates
• 2025 payment trends
• Is the secret to better cash flow management AI?

Learn more about how WEX payment solutions can be tailored to your business, so you can accelerate and streamline operations while creating lasting growth and success for your organization.

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The information in this blog post is for educational purposes only. It is not legal or tax advice. For legal or tax advice, you should consult your own legal counsel, tax, and investment advisers.