Search

Virtual Cards vs. Physical Cards

Updated: Aug 15, 2021

The advent of virtual cards has brought loads of security solutions to the lapses in the physical cards in the payment industry, especially for online customers who love shopping online. Virtual cards are even popularly referred to as Online Shopping Cards. However, virtual cards are yet to gain as much popularity among online shoppers as physical cards, and this has deprived many the security benefits that virtual cards provide.


WHAT ARE VIRTUAL CARDS?


Virtual Cards are electronic cards meant for online transactions. They come in both Credit and Debit Card form.


1. Virtual Credit Cards: These are series of 16 digits that are generated randomly together with a CVV code and expiry date that can be used to make online transactions such as online shopping etc. The randomly generated card number routes charges to the original credit card number.


2. Virtual Debit Cards: These are similar to virtual credit cards but the randomly generated number is linked to the actual debit account instead of the original credit card number.

HOW VIRTUAL CARDS WORK


The randomly generated numbers are temporary. Each generated number is valid for only one transaction and once used for a transaction, it cannot be used again. The next transaction have to be made using a newly generated number. These temporary card numbers are generated through very secured web or mobile applications. The card issuers through these applications provide special software that is installed on users’ devices.This means the temporary card numbers generated are associated with the user’s actual account or card.


Virtual Cards are easily generated and have a flexible feature that makes it possible to close your card with just a few clicks. Virtual Cards make it possible to reduce the amount of personally identifiable information you share on the websites you make purchases on. Also, you can set a spending limit on the virtual card, lock out certain merchants, and restrict usage of the card elsewhere in case of merchant breach.


ARE VIRTUAL CARDS MORE SECURE THAN PHYSICAL CARDS?


Unlike physical cards, it is impossible to trace virtual card numbers until the card holder’s identity or physical card is identified which is highly unlikely because the randomly generated numbers are only valid for one transaction and a limited period. This feature prevents the theft of personal information and the possibility of misusing such information. Other significant security features of virtual cards are as follows:


1. The validity period of the virtual cards is set by the card issuer

2. There is a minimum and maximum charge limit per transaction each day

3. Credit balance can be used in part and whole. However, the number becomes inactive after payment has been made therefore useless for potential fraud.

4. Virtual cards can be instantly blocked online without going through the stress of contacting the card issuer

5. It is easy to control the payment parameters


TOP 5 VIRTUAL CARD ISSUERS IN THE UNITED STATES

1. US Unlocked: This allows you to shop on U.S. e-commerce websites anywhere in the world using their Virtual Payment Cards with U.S. Billing or Shipping addresses. They offer two types of cards; a one-time-use card that cannot be reused after a transaction, and a merchant-specific card that locks a merchant after a transaction.


2. Blur: A virtual credit card provider that helps you protect your payments, bank transactions, privacy, and credentials from cyber criminals. It generates new credit card numbers for every purchase and prevents secret data collection, blocks hidden trackers, and encrypts your password.


3. Airtm: A platform that enables online purchases to be made in any currency using a virtual card. It allows you to carry out transactions online using real exchange rates and the digital card can be funded using dollars.


4. Privacy: A virtual card platform that offers a unique card number that only works for one merchant per transaction. Allows you to turn off the subscription service with just one click. The card closes automatically after the first use.


5. Bento: A virtual card provider that offers an easy way of managing your organization’s expenses and spending. It allows you generate and assign a virtual card to your account.

TOP 3 VIRTUAL CARD ISSUERS IN INDIA


1. ecoVirtualCard: A single-use card that will automatically become inactive when your desired transaction has been completed. This helps to curb payment fraud.


2. eWire: A payment solution that allows users create virtual cards for international transactions and all kinds of online purchases.


3. Netc@rd: A virtual card from Kotak Mahindra Bank that is created through a debit to your account on Net Banking. It can be used to shop online and pay any merchant worldwide.


TOP 3 VIRTUAL CARD ISSUERS IN WEST AFRICA


1. Wallets Africa: A platform that enables SMEs to create a current account and also issue virtual and physical cards to individuals.


2. Barter: A Flutterwave payment solution that allows you send money globally and create virtual cards that work online from anywhere in the world.


3. Eversend: This mobile-only payment platform enables you exchange, save and send money instantly using virtual cards. Eversend refers to itself as neobank for Africans.


TOP 3 VIRTUAL CARD ISSUERS IN EAST AFRICA


1. Reserveport: A payment solution platform that issues virtual cards for online transactions such as payment of airline tickets, online shopping, hotel bookings, etc.


2. DPOCard: DPO virtual card enables small businesses make online transactions and pay any vendor across the globe. It is available in USD, GBP, EUR, and local currency.


3. Chura: A payment solution platform that enables you create virtual cards for all online transactions using your mobile phone. It is accepted by popular online brands such as PayPal, Amazon, Uber, Netflix, etc.


If you are an online shopper, virtual cards are payment solutions that are not only fast, but also very secure for you. These cards hide your personally identifiable information from merchant websites, issue one card number per transaction among several other benefits as explained above to help you freely make purchases online without fear of cyber criminals.



RESOURCES


Angelov, Boris. “Are Virtual Credit Cards More Secure than Physical Ones?” Payhawk, 9 May 2020, payhawk.com/blog/are-virtual-credit-cards-secure/. Accessed 25 May 2021


Bento For Business. “What Is a Virtual Card? | Bento for Business.” Bentoforbusiness.com, 28 Sept. 2020, bentoforbusiness.com/bank-cards/what-is-a-virtual-card/. Accessed 25 May 2021


Guru99. “15 BEST Virtual Credit Card/Debit Cards in USA (2021 Update).” Www.guru99.com, 2021, www.guru99.com/virtual-debit-credit-card-usa.html. Accessed 25 May 2021


Moses, Daniel Anuoluwapelumi. “Get a Virtual Dollar Card in Nigeria on These Platforms.” Dignited, 23 June 2020, www.dignited.com/65113/get-a-virtual-dollar-card-in-nigeria-on-these-platforms/. Accessed 25 May 2021