Commercial Cards Changed Gradually, Then Suddenly

Recent events in the corporate card space have driven many banks to a fork in the road. In describing how the industry got here, it may be apt to borrow a familiar phrase from Hemingway: “It happened two ways. Gradually, then suddenly.”

The gradual shift began nearly a decade ago. Challengers like Ramp and Brex arrived on the scene within the last ten years, with a mission to reimagine commercial cards and their role within the broader financial toolkit for businesses of all types and sizes. Their growth is difficult to ignore. Ramp, for example, reported in its 2025 recap press release that the company now serves more than 50,000 customers and processes more than $100 billion in annualized purchase volume across its platform.

Then came the sudden jolt. Capital One’s acquisition of Brex at the beginning of the year sparked urgency among bank executives and industry observers alike. Ramp’s $750 million series F valued the company at an incredible $44 billion, further upping the ante and putting the industry on notice.

Taken together, these developments signal that banks are reacting to tangible shifts in revenue, customer expectations, and competitive dynamics. The commercial card market has blown through the hype phase and has entered a new era.

In recent conversations with banks, we observe the response to be twofold. On one hand, institutions are focused on defending their existing portfolios against the risk of attrition. On the other hand, they are looking to capitalize on growth opportunities by expanding their presence in the commercial segment.

From a defensive standpoint, the cost of standing still will only increase as more high-value customers determine that the grass is indeed greener on the other side and seek alternatives. From an offensive perspective, that opportunity remains compelling despite the intensified competition. The corporate card market, valued at approximately $150 billion in 2025, is projected to nearly double by 2033, according to Data Insights Market.

Regardless of where a bank begins, the challenge often lies in how they have historically measured success. Most banks measure churn by the number of customers, not volume or value. Value is often concentrated in a relatively small segment of high spend clients, who are also the ones most likely to seek out more modern card experiences.

This result is a gradual, seemingly silent erosion of revenue, not a visible churn crisis. This dynamic is most visible in the middle market, referring to business customers that sit between SMB and large enterprise, where spend is meaningful but needs are increasingly complex.

While the middle market has become the primary battleground for commercial card innovation, the response is not limited to any one tier of institution. In fact, many of the largest banks have been among the most active so far, moving quickly to evaluate partnerships and close capability gaps.

At the same time, regional and community institutions face a more acute structural challenge. Their customers often have meaningful spend, growing operational complexity, and expectations that legacy tools were not designed to meet, but with fewer internal resources to address those gaps independently.

For banks setting out to defend their portfolios or expand into this segment, we’re seeing a new philosophy emerge. The natural instinct would be to assume that adding point solutions, such as expense management capabilities, on top of existing systems is enough to remain competitive. But that approach addresses only part of the problem.

Banks today are changing the way they think about this to align more with the current reality, which is that spend management and card infrastructure are interdependent, and the gap is broader than either alone.

The shift in focus turns towards the experience around the card itself, and how it serves as a gateway to financial workflows beyond the transaction.

In practice, how these modernization initiatives actually gets done is evolving as well. Most banks are not pursuing full-scale infrastructure overhauls, such as core conversions or side core standups, to address this challenge in the near term. Those efforts are typically reserved for broader strategic transformation initiatives.

Instead, the focus is on delivering meaningful improvements within the constraints of existing systems. For many institutions, this means layering modern capabilities on top of current infrastructure in a way that avoids adding unnecessary complexity or long-term technical debt.

The key components of this strategy include a specific focus on areas where their customers are demanding modernity. For example, we see banks prioritizing mobile experiences that go beyond simple interfaces and enable real work to be done, such as capturing receipts at the point of spend and reducing manual administrative tasks. Related to this, they are introducing more robust self-service controls, allowing businesses to set card limits, approval flows, and spending policies without relying on manual intervention.

Automation is also becoming a focal point, particularly in areas like receipt matching, tax handling, and pre-accounting processes, where efficiency gains can be significant. At the same time, deeper integrations with systems such as ERPs, accounting platforms, and HR tools are becoming essential, as customers expect their card programs to connect seamlessly with the rest of their financial operations.

For banks, building and maintaining these capabilities internally presents the biggest operational challenge. As a result, many are turning to partners who can deliver these integrations and workflows as part of a broader solution.

These changes have direct economic implications for banks beyond keeping pace with evolving expectations.

As modern card experiences become more intuitive and better integrated into day-to-day workflows, they naturally drive increased usage. When employees and finance teams rely more heavily on card-based payments, transaction volumes grow, and with them, the associated revenue streams for issuing banks.

At the same time, the efficiency gains can be just as meaningful. Features such as self-service controls, automation, and integrated workflows reduce the need for manual intervention, lowering support costs and easing the burden on internal teams. As these efficiencies scale across a portfolio, the cumulative effect can be substantial.

Operational execution is the biggest challenge cited by banks looking to safeguard their commercial portfolios. Many institutions continue to rely on systems that they’ve had for 10-15 years and are deeply embedded in existing workflows. Even if it’s not a full-blown core conversion project, these smaller initiatives can still introduce a significant amount of operational complexity, particularly for teams that are resource-restrained.

In our conversations with banks, these initiatives are steadily moving higher on the priority list for the coming years.

The opportunity is to take practical steps that meaningfully improve the customer experience today to align with modern expectations, versus trying to build everything at once.

Banks have woken up to this new reality, and those that act decisively are closing the gap.