Virtual credit cards can be used for online purchases and can be connected to a particular vendor for multiple payments but a setup process is required.
However, in recent times security infringements are taking the front row on almost every news platform regularly, which is prompting hesitations in consumers about using credit cards for online transactions.
The good news is that as a reply to the concerns of customers about credit card fraud or scams, many credit card providers now give virtual credit cards.
Although, a virtual credit card is not exactly a credit card but rather recognized as a virtual credit card number.
Therefore, a new number is generated for every single purchase you make, which makes it quite difficult for cybercriminals or fraudsters to utilize a stolen card number.
Generally, here are few things to know about how virtual credit cards work.
An Existing Account
The first step before using a virtual credit card is that you must have an existing account linked to the card
Then, you can now use virtual credit card numbers for shopping and paying bills online.
In addition, the virtual card numbers are connected to your already existing credit card, simply because the charges will be displayed on your monthly statement.
However, at the point of sale, the trader will receive the virtual card number instead of your actual card number.
Install a Virtual Credit Card on Your Computer or smartphone
In order to use a virtual credit card, you must install the software that generates different credit card numbers at every moment of request.
Although, some virtual credit card providers have a mobile app as well that unifies with your phone wallet and also permits the utilization of virtual card numbers when you opt for your phone to make any payment.
It can be used to settle Monthly payments
Generally, every temporary credit card number is restricted to a particular trader or vendor because the generated number can be used multiple times by that same vendor. However, a virtual credit card is suitable for multiple payments.
Although, each number is only valid and active for the duration of a year, so you will be required to update your account with a different card number yearly.
However, when you set up multiple payments with your virtual credit card, ensure to set the limit high enough to complete all of your payments for the duration of a year.
In addition, if the limit is attained, you will need to update your credit card data at the vendor or trader with a new virtual card number.
Virtual Credit Cards Work online only
One fact is that virtual cards won’t keep you protected from credit card skimming, scams as well as other credit card fraud that happen at the point of sale.
However, you can decide to use an instant virtual credit card number when shopping or paying bills virtually and when using a mobile app to execute purchases via your phone’s wallet.
Monitor Your Credit Score and Statements
Usually, hackers and other criminals are continuously looking for means to breach security measures.
Although virtual credit cards are just a step in the right direction, you are still required to be vigilant and look out for suspicious activities because no security method or scheme is 100%.
So it is still essential to carefully evaluate and assess your monthly statements as well as secure your credit card.
Lastly, the good news is that since you are using a temporary credit card number, it will enable you to spot where a fraudulent activity was executed if it ever transpires.
Don’t miss important articles during the week. Subscribe to blockbuild weekly digest for updates