Virtual Account Management Solutions Adoption is on the Rise

Adoption of Virtual Accounts by Leading U.S. Banks

Virtual account management (VAM) systems have gained significant traction in North America. Already widely adopted elsewhere, US banks now recognize the immense benefits VAM brings to both banks and customers.

Early adopters have seen their investments pay off by winning business and outpacing their competitors. Now is the time for banks to leverage VAM solutions to secure their market position. Research by Datos Insights, a global advisory firm, shows 86% of surveyed banks had invested in or planned to invest in VAM by 2025.

Goldman Sachs highlighted virtual accounts as one of the four pillars underpinning the next generation of transaction banking. Leading US banks have already integrated VAM solutions. For instance, in 2022, Bank of America expanded its virtual account management services to the U.S., having previously achieved success with these systems in the UK, Ireland, and the Netherlands. Other major institutions, such as JP Morgan Chase and Citi Bank, have also launched their own VAM systems. Together with Wells Fargo, these four firms represent the largest US banks by deposits and assets, and were on track to earn 44% of the Industry profits of all 4,000+ banks as of Q3 2024 according to the Financial Times (US banking giants capture biggest share of industry profits since 2015).

Providing a VAM platform enables mid-size and smaller banks to compete with the top banks to win deposits and enable customer self-service.

According to Datos research, virtual accounts are becoming a key competitive advantage for midsize banks in 2025. With 92% of banks increasing their investment in payment technology, mid-tier banks have both the resources and the incentive to adopt advanced solutions like virtual accounts. By enhancing payment services, virtual accounts help these banks capture downstream spending, boost revenue, and mitigate the risk of fintech disintermediation.

Keeping clients happy, attracting new clients, and maintaining existing balances are crucial.  

The ability to keep clients happy, attract new ones, and maintain existing balances is not just a goal—it’s a necessity for long-term success. 

In today’s competitive landscape, customer satisfaction is more important than ever. To retain existing clients and attract new ones, banks must deliver innovative solutions that meet evolving customer needs. Virtual account management systems offer a strategic advantage by providing clients with greater control, transparency, and efficiency in managing their finances.  

Satisfied customers are more likely to maintain and even increase their account balances, a critical factor for banks as they seek to grow their deposit base. VAM allows customers to streamline their financial operations, reducing administrative burdens and enhancing their overall banking experience. This not only fosters loyalty among existing clients but also serves as a compelling value proposition for potential new customers.

Moreover, as businesses increasingly seek out banking partners that can support their complex financial needs, offering a robust VAM solution positions a bank as an institution that prioritizes client success. By investing in virtual account technology, banks can effectively maintain and grow their deposit base while standing out in a crowded marketplace.  

The quality and stability of deposits have become paramount, especially considering the recent banking failures caused by unstable deposit bases. By offering a VAM product, which provides significant benefits to clients, banks can cultivate a sense of loyalty and “stickiness” among their customers. This, in turn, helps to ensure that deposits remain stable, even during challenging times, safeguarding the bank’s long-term health and resilience.

Why Banks Are Embracing Virtual Account Management: Saves Money and Time for Your Customers and You

Banks are increasingly turning to virtual account management systems because they offer a dual benefit: significant cost savings and improved efficiency for both the bank and its customers.

For customers, VAM simplifies financial management, offering greater transparency and control. Businesses can allocate funds, manage payments, and monitor transactions across various virtual accounts without the need to open and maintain multiple physical accounts. This efficiency translates into time savings, reduced administrative workload, and lower banking fees, all of which are highly valued by customers.  

On the bank side, the traditional approach to managing numerous physical accounts is not only resource-intensive but also expensive. Each physical account requires maintenance, incurs fees, and demands significant administrative oversight. VAM streamlines this process by allowing customers to manage multiple virtual accounts under a single physical account. This consolidation reduces the costs associated with account management and minimizes the need for additional resources.  

Moreover, by adopting VAM, banks can offer tailored solutions that meet the specific needs of different industries and clients. This customization not only enhances the customer experience but also positions the bank as a forward-thinking partner, capable of providing innovative solutions that drive business success.  

In short, VAM is a win-win solution. It saves money and time for customers, enhancing their satisfaction and loyalty, while simultaneously reducing operational costs and complexity for the bank. As the demand for more efficient, cost-effective financial solutions continues to grow, VAM stands out as a crucial tool for banks seeking to remain competitive and deliver value to their clients.

Cashfac: Your Partner in Virtual Account Management

At Cashfac, we have partnered with banks globally for over 30 years, implementing our virtual accounts platform. Our extensive experience in managing complex client money operations positions us uniquely to help U.S. banks navigate this shift. As demand for virtual accounts continues to rise in the U.S., our expertise ensures we can support banks in this critical transition. 

Building a virtual account management solution in-house is both costly and time-consuming, often taking several years, draining resources requiring long time to ROI. On the other hand, we can implement our solution in just 12 weeks, ensuring a return on investment within less than 12 months. With our single solution, we offer industry-specific configurations and personalized interfaces, providing a compelling alternative to typical off-the-shelf solutions. 

With decades of experience working with banks and corporates, we understand the needs of both institutions and their customers. This enables us to deliver solutions that drive efficiency, support growth, and enhance the customer experience. As the demand for virtual account solutions continues to rise, Cashfac is committed to helping U.S. banks stay competitive and meet customer expectations.

Take Action Now

Act now to stay ahead. Get in touch to learn more about how Cashfac can help you leverage the benefits of virtual accounts.