Redefining the Payment Landscape with Innovative Strategies

Lucas Davis, Relationship Manager, Capital One

Lucas Davis, Relationship Manager, Capital One

Lucas Davis has been a driving force behind the payment industry’s transformation,  streamlining and securing B2B transactions. Through strategic leadership, he spearheaded the adoption of virtual payment solutions, enhancing payment efficiencies and supporting supplier enablement.

In an interview with Banking CIO Outlook, Lucas shares insights on transformative technology advancements that are paving the way for a promising future and ongoing growth in the tech-driven sector.

Can you describe your journey in the industry and your current roles and responsibilities at Capital One?

I began my career in the credit card and business payment space around 23 years ago at American Express. Initially, I started as a small business service and sales representative. Over the years, I worked my way up through various roles, including team leader, manager of business development, and director in the global space.

After 21 years at American Express, I joined Capital One as the Vice President for Commercial Cards, managing the Arizona market. My responsibilities involve mid-size customers and optimizing the payment process, especially through virtual cards, aligning with the industry’s trend toward streamlining processes.

How has the payment and card space evolved lately, and what is your view on its current status?

The industry has become more competitive in recent years. A decade ago, there weren't many salespeople actively pitching multiple payment platforms. Banks issued business credit cards, but they didn’t have an active sales force pushing their products. Now, numerous companies, including Capital One, have sales forces actively prospecting the same clients.

The competition has become more driven, offering higher incentives and more aggressive pricing strategies. Post-COVID, the competition has intensified, with companies determined to differentiate themselves beyond traditional reward programs. The focus has shifted to creating new revenue streams for businesses through virtual payment solutions.

Are there any emerging trends in technology or process elements in the market to tackle the prevailing pain points?

In the industry, the growth in the adoption of virtual cards is no secret. Whether it's major banks or startup tech companies, every card provider offers some form of virtual payment solution. This not only makes paying suppliers quicker and more efficient but also enhances security by providing one-time card numbers for each transaction.

The driving factor behind this trend is the potential rebates of 2 percent, which can be a significant amount when the transaction equates to millions of dollars in outgoing payments—often a six-figure return for the business. Virtual cards have become the new frontier we're promoting. With advancing technology, the conversation has shifted from a tough sell to an educational one as we launch platforms that streamline accounts payable, create rebates, and improve the overall processes.

Why is improving supplier enablement important for organizations?

The industry is focused on improving supplier enablement as it is crucial to ensure when a customer sends us an accounts payable file with numerous suppliers for substantial amounts.

Supplier enablement involves due diligence and outreach to understand terms, negotiate fees, and ensure vendors can accept virtual or credit cards. This approach is a collective effort aimed at avoiding customer dissatisfaction by preventing delays when it's time to go live with payments.

How do you envision the future of this space with the potential disruptions and transformations?

With over 13 years of face-to-face sales experience in the payment industry, I have a deep understanding of the competitive landscape. Concerns arise regarding potential taxation on credit card rewards and rebates, impacting program launches.

"Post-COVID, the competition has intensified, with companies determined to differentiate themselves beyond traditional reward programs. The focus has shifted to creating new revenue streams for businesses through virtual payment solutions.”

While advising companies to consult with their certified public accountant, I'm optimistic about the efficiency of virtual credit cards, especially with improved technology integrations. Despite trillions in the B2B payment space, credit card usage remains low, presenting a significant opportunity for increased acceptance with streamlined processes.

What advice would you offer to your peers and upcoming professionals in this industry?

For those new to the payment landscape, believing in what you're selling is essential. It's not about selling an expense but offering a payment solution that would generate revenue, create cash loans, and improve payment efficiency. It's important to build relationships and focus on customer service.

The industry operates on a residual business model where you commit to a certain amount, and over time, as you spend, you receive commissions. The best sales representatives focus on engagement, servicing client accounts, and ensuring long-term customer satisfaction rather than quick sales.

Before promising, understand your product or payment platform thoroughly. Knowing the ins and outs and having faith in its value will contribute significantly to success in the industry.