Fleet operators have a crucial role in the global logistics supply chain – managing the movement of goods and services to enable businesses to prosper and consumers to receive their goods on time. Innovation can be essential in helping fleet organizations save time and resources, yet legacy fleet payments have not always addressed major industry pain points, which can demand modern technology solutions enabled by seamless and secure digital transactions.
Challenges the industry faces include fraud caused by persistent use of mag stripe-only cards, failure to utilize new technologies such as tokenization and digital wallet capabilities, opaque pricing and antiquated platforms with outdated user interfaces. Today’s fleet management processes are often still manual, and lack easily deployed controls that can make it difficult to prevent fraud. To put this into perspective, if only three percent of fleet card spend was unauthorized, this would add up to more than two billion of additional costs for U.S. businesses.
Visa works directly with the issuers of fleet cards, whether they are large financial institutions or smaller fintechs. Visa’s Nareg Guregian, director of B2B Fleet Partnerships, reflects on the exciting opportunities to innovate in fleet management and how Visa is positioning customers to thrive in this ecosystem.
What are Visa’s new capabilities for fleet card tokenization and digital wallets?
Nareg Guregian: We are very excited about new enhancements to our fleet cards, such as introducing tokenization and provisioning for mobile transactions. This enables issuers and fintechs to integrate encrypted and tokenized card information into Apple Pay mobile wallets, providing a seamless and secure experience for commercial fleet drivers and fleet managers. We are also working with other digital wallet providers and have some exciting momentum in the pipeline.
An innovative feature of this enhancement is the ability to provide fleet data tags through a default configuration set up by the issuer, fintech or processor. This means that fleet data tags, which were previously tied only to the plastic card chip, can now be dynamically provided during the token provisioning process. Once the token is loaded into the mobile wallet, Visa's contactless specification allows for token payment data and the fleet data tags to be passed to the point of sale.
Visa's tokenization capabilities address the pain points of the current manual, and sometimes inconsistent, end-user experience. This enables digital credentials to be pushed into mobile wallets, card-on-file merchants and Click to Pay. This digital experience can reduce the time to issue a card from seven to 14 days with a physical card to just a matter of hours for a push to a digital wallet.
How is this a more holistic technical approach compared to other industry offerings?
Guregian: Our goal is to better position issuers and merchants in the changing landscape of employee mobility. With EMV at fuel pumps in the U.S, the growing traction of electric vehicle fleets, and fintech enhancements to fleet management software, Visa has introduced significant enhancements to the Visa Fleet product platform. Visa provides commercial clients with more granular product category level controls, more enhanced data and the ability to receive enhanced data faster for real-time business decisions.
Our enhanced data program helps our issuer partners create fleet products that address many of the existing pain points for their business customers. As a result, Visa fleet cards enable businesses to make confident fleet-related purchases within Visa’s leading merchant network.
This confidence is based on product capabilities, such as enhanced data gathering, expanded authorization controls, extended transaction reporting and an integrated product with streamlined billing. Visa Fleet provides fleet operators with a chip-based solution that offers enhanced controls, data and reporting to enable fleet operators to better track and manage fleet purchases.
What are two examples of clients who are benefiting from this technology?
Guregian: Coast, a fintech issuing Visa fleet cards, has created a fleet management software platform that includes an innovative UI for easy reporting and monitoring of fleet card spend for business owners. They’ve also created an SMS check-in experience for drivers in the field, which contrasts with the standard PIN-entry check-in experience prevalent in legacy fleets. Overall, the SMS experience has led to easier check-ins and greater flexibility, allowing different drivers to use the Coast Visa card without raising the risk of fraud.
Car IQ is another partner issuing Visa fleet cards in the U.S. What makes them unique is their issuance of Visa credentials directly to the fleet vehicle instead of a driver. This method helps to prevent driver misuse, card misplacement, and fraud. Car IQ has integrated directly with the fuel merchants’ back-end systems to get access to the “enhanced data” from the transaction and customers can then track the spend on Car IQ’s expense management platform. We are also excited to mention that we’re working with Car IQ to integrate into our B2B Payables platform. This integration is meant to create a one-to-many connection, allowing Visa and Car IQ to offer fleet management capabilities to all issuers currently integrated to B2B Payables without the need for lengthy onboarding processes.
How does Visa partner with fintechs in the fleet industry?
Guregian: We have multiple partnership strategies that work with a full range of fintechs. First, we have direct commercial issuing partnerships for fintechs to issue their own Visa fleet card. Fintechs that have direct commercial issuing partnerships with us have direct access to Visa resources and an account manager ready to support. This structure is great for fintechs that have created expense management software and want to include a robust card product to accompany their offerings.
In addition, for fintechs who want to issue fleet cards but aren’t sure how to get started, we can connect them to our partners, such as processors, who can connect our fintechs with financial institutions (or other fintechs) for fleet partnerships. We also connect them directly with our large issuers for fleet partnership opportunities or with merchants and fleet-related software vendors to create discount partnerships and referral models.
Finally, we lean into the strength of our ecosystem by positioning them to collaborate with other Visa business units that can help them strengthen their overall product offering, such as the small and medium-size business (SMB) team, Visa Direct, and our Virtual API team.
What are existing fleet capabilities that excite you and have been gaining traction in the market?
Guregian: Our Fleet 2.0 initiative excites me because it is driving our ability to provide commercial clients with granular product category level controls, enhanced data, and the ability to receive enhanced data fast for real time business decisions.
Visa Fleet 2.0 harnesses the additional capabilities of EMV at the fuel pump in a solution that is straightforward for fuel merchants to implement. In addition to many driver prompt options, this functionally enables commercial clients to restrict card use at fuel merchants to certain fuel and non-fuel product categories. For example, cards that can only be used to purchase diesel fuel or used for EV charging.
As part of this initiative, Visa has also introduced the capability for product category level controls to be dynamic for clients through a host-based product restrictions solution. These dynamic controls will enable the passing of product category level restrictions in the Auth Response message to fuel merchants to allow the clients to adjust what product categories can be purchased in real time.
To enable the enhanced functionality of the EMV chip and host-based product restrictions, Visa has made enhancements to VisaNet transaction messaging to pass additional data in Auth and Clearing messages, including a new clearing record type for passing Level 2 fuel data.
The enhancements combined with the capabilities and services provided by Visa issuers and Visa merchants result in a compelling and competitive fleet and mobility payment solution.