Credit cards have become a popular cashless payment method because of the convenience they offer, especially for online transactions.
Though making online transactions using credit cards is convenient, card details are shared with merchant sites which might put the user's card information at risk of being compromised. And, this is where virtual credit cards come in.
Here's everything to know about virtual credit cards.
Simply put, virtual credit cards are like credit cards with no physical existence. These are either linked to the cardholder's physical credit card or bank account. With features similar to those of credit cards, virtual credit cards are designed to protect one's original card/account information.
However, unlike traditional credit cards, virtual credit cards are generated by users.
Also, the VCCs are generally provided for free by banks; these come with no joining or annual fees.
If the VCC is linked to one's credit card as an add-on credit card, its credit limit is either decided by the cardholder or the concerned bank (depending on the individual's eligibility).
If the VCC is linked to the user's savings account, they should load the card with an amount of their choice.
However, VCC's limit is usually small compared to regular credit cards.
Virtual credit cards are generally meant for one-time use. The validity of VCCs is less; these usually expire within 24-48 hours. Even if the balance isn't used, the VCC expires after a specified time and the remaining balance is credited back to the original source.
Virtual credit cards are one of the safest payment options for online transactions.
VCCs are just temporary cards and it's not possible to track a VCC back to the primary credit card or the customer's bank account; these cards cannot be cloned.
Even if VCCs are hacked, cybercriminals can't use them beyond the loaded balance, which is usually small, or after its validity expires.
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