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Virtual Credit/Debit Cards: How Do They Work?

Virtual credit/debit cards

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Virtual credit/debit cards might sometimes serve the need for adding an extra layer of security against fraud by masking some confidential information from those who seek it. These cards serve the great purpose of helping the user transact funds from their bank account through deposits or withdrawals. They are also a convenient way to pay online and in-store. However, more inquiries have been raised regarding how it can be used and how to obtain a safe card free from fraud. While other cards might be used as bait for fraudsters to access your account, you need a heads-up on the best way to use it to save you from such uncertainties. 

What are Virtual Credit/Debit Cards?

A virtual payment card has been simplified from its physical form and reduced to a 16-digit primary account number. This card is only different from the physical one because they don’t have the same security limitations. They can generate a unique card number for every transaction made using the same card for protection against cyber criminals who could easily hack your account, rendering you bankrupt. 

You must’ve experienced this before when shopping online when you are asked to read for the shop attendant the card number over the phone, or you’re asked to send it directly from your phone. Note that these digits have an expiry period. Depending on the bank, these digits could disappear within 30 minutes to 2 hours. The advantage is that it won’t result in any over-expenditures. These digits can only be used once, and once the company you’ve done business with falls in the hands of fraudsters, your 

account is free from a breach. Once the digits have expired, you can request another to help with the transaction. 

Read: How Payment Technology has Transformed Healthcare Industry

Virtual debit cards can be flexible sometimes since the owner has been granted permission to create new card numbers for different stores, change them, or even delete them without altering the account. Since many physical stores have not embraced this mode of payment, most people prefer using cash or other methods other than this. Therefore, most people transacting with virtual credit cards prefer using them on their online clients. Let’s now discuss how to obtain these credit cards and how they work. 

How to Obtain a Virtual Payment Card

In most cases, it’s a requirement to have a physical credit card before asking for a virtual one. Since this process involves transitioning to a digital avenue, it is also done online. You can request a virtual card by logging in to your account online, either using the web or your card issuer’s app, then looking for a virtual credit/debit card number settings option. After this application, you are given a temporary card through the app or the web. 

Virtual Credit/Debit Card: How Do They Work?
fortuna500.com Virtual Credit/Debit Card: How Do They Work?

A single-use card can be defined as the card generated every time a new virtual credit card is created or changed when making a purchase. When displayed, the merchant sees its details and offers needed help. Depending on the service provider, these temporary cards could last 1-365 days before expiry. In other cases, you might also need to generate a temporary card from a specific app for virtual cards. Either way, the rules are the same, depending on the bank. 

Read: eCash 101; Definition and Benefits

Once you obtain a virtual MasterCard, you are at liberty to modify settings as to the spending limit or determine the expiration date. You can also determine whether the number used online could also be used for making physical transactions. Lastly, you can determine whether you can use the number to make purchases online or via the card app. 

How do Virtual Credit/Debit Cards Work? 

Just like a physical bank card, a virtual credit card’s main purpose is to permit withdrawals and deposits from respective banks. The only difference is that this is accessed online, using a phone or the web to make transactions. Moreover, you need to create a virtual credit card number through the bank or credit card issuer, which can then be used to replace the physical card when making a purchase online. 

Virtual Credit/Debit Card: How Do They Work?
Virtual Credit/Debit Card: How Do They Work?

These cards are very safe to use for your online transaction since the actual credit card number is withheld from a merchant. When making a payment online,  you may either seek your merchant’s help by reading the credit card number for them or dial it in yourself. After this is done, you might need to wait for a short while before the disbursement. In case of any delays during the transaction process, contact customer care for help, and do not prompt another payment. This could lead to incurring losses due to double payments, while it’s clear that once a transaction is made online, it cannot be reversed. 

Read: 4 Best Ways to Easily Become a Cashless Business

As mentioned at the onset, using virtual credit cards might pose some risks for fraud, especially when not properly handled. In case of any fishy transactions, report these fraudulent transactions and cancel the virtual card number when it’s still active. However, this rarely happens because the card numbers are one-time. Many advantages come with using this method. They include:

  • Increasing payment security
  • Simplifies supplier payments
  • Saves money in accounts payable operations
  • You stay in control of the settings
  • You can manage your subscriptions or unsubscribe from them
  • There is instant activation so that you won’t wait long
  • You have access to instant notifications.

Final Remarks

With the world today going digital, most people are embracing new forms of credit transactions that are convenient. While it could sometimes pose risks, virtual credit/debit cards are a convenient way of making payments during an online purchase. They allow you to make payments over the phone and in the comfort of your home. It is also safe in that it protects you from fraudsters accessing your account using an untraceable fluctuating number. These cards work exactly like a physical bank card, only that they can be accessed over the phone or online. 

Related Articles you Might be Interested in: 

How to Get  a Virtual Payment Card

How to Make Payments Online without Regional Restrictions 

6 Best Virtual Mastercards and Why

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