The credit or debit cards Physical can have a virtual version available that the bank or the entity in charge of its issuance offers you.
In this digital age, electronic payments are increasingly common, having greater diffusion between stores and businesses. If you want to know how they work and their characteristics, follow us.
- What is a virtual card
- How virtual cards work
- Where to get a virtual credit card
- Advantages of using a virtual card
- Differences with paid apps
What is a virtual card
A virtual credit card (VCC – Virtual Credit Card) represents a disposable option of a physical plastic issued by a financial institution.
This functionality makes it used in online purchases and has other security provisions. For this reason, it is a product that is used to give you convenience and avoid certain problems associated with physical versions.
The main difference of a VCC lies in the way it shares the information it contains. In a physical credit card, the data that it has integrated does not suffer alterations during the life cycle of the plastic, being vulnerable to the theft of hackers or other cybercriminals.
Instead, a virtual card provides dynamic information, changing the verification data every time you make a purchase.
How virtual cards work
Most online stores need to store their customers’ personal and payment information for various purposes. As part of a more agile and efficient service, these records avoid having to enter your data over and over again.
The problem is that hackers can get this information, putting you at risk of fraud or identity theft.
Unlike normal credit cards, virtual cards make use of an application to generate a token or a new number for each operation you do.
This momentary identifier is transmitted between the bank and the merchant to approve the transaction. The advantage over the fixed token that uses the information printed on the plastic, is that digital can only be used once, reducing the risk of theft.
Where to get a virtual credit card
As a general rule, the largest commercial banks have free virtual cards for your cardholders. When you are not sure that your issuer offers this service, we suggest you ask them to find out.
These products are more customizable, allowing you to configure spending limits, automation of Bill Pay or expiration dates.
In case your bank does not offer you a digital plastic, you can use an outsourced service that works with the physical card you have.
For example, the Final brand offers you a variety of payment services, including virtual cards. Entropay is another popular option that allows you to create disposable virtual cards for free.
Advantages of using a virtual card
Virtual cards can be an alternative safe, easy to obtain, and hassle-free to make your purchases. We remind you that these digital plastics can only be used through a call or in ecommerce businesses around the world.
Besides being difficult for hackers to track down, they are very useful due to:
- Virtual cards are valid for a period of time imposed by the sponsored bank or the issuer of the plastic.
- Those who use these financial instruments have a minimum and maximum limit per operation each day.
- In the case of a remaining balance in the account, this money will be returned to the customer’s original credit card when the virtual one expires.
- These digital cards are only available to holders of a physical credit card, so there is no possibility of having an additional plastic credited to someone else.
- Customers who own these banking products can make a transaction using the entire available balance or only a part of it.
- Since virtual cards are not made up of tangible items, trying to clone them is very difficult. This feature makes them much safer for online transactions.
Differences with paid apps
Although they work in a similar way, virtual cards should not be confused with payment applications such as Google Pay, Apple Pay, PayPal, Venmo or Zelle among other.
The basic difference is in the use or not of the plastic number when paying. With an app, the merchant receives a limited-use identifier to validate the operation.
On the other hand, the contexts are also different for these two technologies. While digital cards are used more to make purchases online or by phone, payment applications are gaining acceptance in traditional stores to give you greater convenience and not stop competing with other businesses.
If you are concerned about taking steps to prevent the theft of your normal credit card information, a virtual card is a good option. In the Business Blog comparator you can find financial products like these to diversify your personal finances.