What Are Virtual Credit Cards?

What Are Virtual Credit Cards?

February 25, 2019         Written By Bill Hardekopf

A virtual credit card is a unique credit card number that links to your main credit card account, allowing you to purchase items online or over the phone. Cardholders do not receive a physical card, but they are given a digital number. Usually, the number can only be used once, and it will expire if the cardholder does not use it within 30 days.

Credit card issuers give existing account holders virtual credit cards to protect them from fraud. There is no way thieves can trace the virtual card number back to the original account. Additionally, since it can only be used for a short period of time (and usually only for a single purchase), fraudsters cannot steal the number and then use it for their own nefarious transactions.

What Issuers Offer Virtual Cards?

Three major card issuers currently offer virtual cards: Bank of America, Capital One and Citi. Each card works in a unique way.

Bank of America: ShopSafe
Bank of America offers cardholders their ShopSafe tool. ShopSafe generates a virtual card number for each online merchant. Cardholders can then set the spending limit for that merchant as well as the period of time the virtual card can be used. ShopSafe also displays virtual numbers, transaction histories for each number and the remaining balance for each account. When cardholders no longer need the virtual number, they can close it from ShopSafe.

Capital One Eno
Capital One offers cardholders an online assistant, Eno, which is a browser extension for Chrome, Firefox and Edge. To create a virtual credit card, simply install the Eno extension and then shop at online retailers. When you are checking out, click the browser extension button and a virtual credit card will be created you can use with that merchant. You manage your virtual account numbers through Capital One’s website.

Citi
Like Capital One, Citi allows users to general virtual account numbers through a web-based tool or a program that can be downloaded to a PC. From this program, users can create virtual account numbers and set spending limits and expiration dates. The virtual account number can only be used for mobile and online transactions. From the program, users can close virtual accounts and check account and transaction information.

What Are The Drawbacks?

While virtual account numbers protect cardholders from credit card fraud, they can also be somewhat inconvenient. For example, if you purchase something from an online retailer and need to return it to a physical location, you may run into trouble because the cashier will need to see the card with which the items were purchased. Since you do not have a physical card, you may have to settle for a store credit or gift card.

Since virtual cards are only good for a limited period of time, you cannot use them for subscriptions as they will expire and your transaction will be declined.

Even with these few drawbacks, if you are planning an online purchase that you will be unlikely to return, it is worth using the tools offered by Citi, Bank of America and Capital One to make the transaction safer.



The information contained within this article was accurate as of February 25, 2019. For up-to-date
information on any of the terms, cards or offers mentioned above, visit the issuer's website.


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About Bill Hardekopf

Bill Hardekopf is the CEO of LowCards.com and covers the credit card industry from all perspectives. Bill has been involved with personal finance for over 15 years. He is a frequent contributor to Forbes, The Street and The Christian Science Monitor.
View all posts by Bill Hardekopf
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