An increasing number of Americans are falling prey to credit card fraud every year. It is being estimated that around 20% of these people blame online transactions for such mishaps and is perhaps the reason why people shy away from shopping over the internet. Virtual credit cards, which offer controlled numbers for payments have been in existence for nearly seven years and are slowly gaining in popularity, allowing people to shop freely without the fear of theft of their personal details.
What is a Virtual Credit Card?
Virtual credit cards are disposable payment cards, which can be used for shopping or making payments over the internet. They are also known as single-use credit cards. These cards provide the protection that consumer’s desire as they are provided with a new card number for every transaction they make, online. These cards are issued by major brands such as MasterCard, Visa and major banking organizations. They are similar to online gift vouchers and totally eliminate any possibilities of fraud.
How do they Work?
These cards are similar in nature to regular cards with the exception that they can only be used online. The accounts associated with the card are funded online and consumers intending to shop online use the number of their virtual card, just as they would in regular circumstances. Virtual credit cards are basically pre-paid cards with no line of credit being made available on them. The user will need to open an account and fund the same before they are able to use the card. Some issuers allow funding of the account with a variety of methods, while others will only do so with a regular credit or debit card.
Signing up for a Virtual Card
The application process for a virtual credit card may differ from one provider to another. However, the basic requirements remain the same. An application available on the CVV shop website will have to be completed apart from downloading the security software to the personal computer or laptop, which is being used. Fees applicable for activation of the card and the account will be debited, once funds are received for the first time. Monthly maintenance charges will also be applicable.
Merchants accepting Virtual Cards
There is absolutely no restriction on any merchants for accepting virtual credit cards. However, it must be remembered that these cards can only be used online and cannot be carried around like a regular card. The merchant will in no way be able to comprehend whether a consumer is using a regular credit/debit card or a virtual card. They will have no access to any data apart from the temporary number, which is generated for the transaction.