In our modern world of rising credit card fraud and more commerce taking place online a new form of credit card has arrived to help us shop safer online.
But what exactly are Virtual Credit Cards (VCC), where can you get one and are they worthwhile?
What are virtual credit cards?
A virtual credit card is actually quite a lot different from your traditional physical credit card.
Whilst it offers the ability to pay for items (online only) using credit, it is here the similarities end.
Traditionally when you sign up for a credit card, the company will send you a physical card and PIN number that you can use to shop.
For virtual credit cards, there is no card! Or PIN number!
The first difference with virtual credit cards is that they can only be used for shopping online and can’t be used in-store due to the fact they only exist online.
The next major difference is that the card details are unique for every transaction that you make!
So the card number, expiry date and CVC number on the back will be different for every transaction that you make!
This provides an extra layer of security against credit card fraudsters who when they have a copy of your physical cards details can spend your money – with virtual cards the details are only valid for a single transaction and so are worthless to fraudsters once used.
This means that when you are shopping online you can live safe in the knowledge that you have that extra security buffer to give you more confidence.
Where can you get a virtual credit card?
Whilst the concept has gained a decent footprint in the USA it is still a very new concept in the UK and as such companies have been slower to release their offerings to the market.
I fully expect this to change over the next 12-24 months as consumer demand for increased security when shopping online pushes the companies to react.
At the moment the best offering I have been able to find is from an online banking company called Revolut who offer virtual cards.
Are they worthwhile?
As with it new technology it is sometimes best to sit on the sidelines and watch it mature for a few months before jumping in.
I believe that there are enough benefits to virtual credit cards that make them a good option for consumers going forward and their popularity will grow quickly once they reach the mainstream audience.
If you do a lot of online shopping then you most likely fall into the bracket of higher risk for having your credit card details stolen so it may be a worthwhile option for you to explore.
At the end of the day, there is no harm in playing it safe!
I have always been good with money – I budget well, avoid making impulse purchases and attempt to adopt a frugal lifestyle as much as possible. I love to share my personal finance tips with you to help you achieve your financial freedom as well.