Virtual Credit card

May 17, 2011 by     No Comments    Posted under: Tech Sambar, Web Security

YOUR online shopping just got easier and safer with the virtual credit card. But, what’s a virtual card? A virtual card is just like your credit/debit card; only it isn’t tangible. It was introduced to check the rising instance of fraudulent transactions over the internet.

A Virtual Credit Card (VCC) is a replica of Real Credit Card which user can generate online, anytime whenever he/she wants to transact on any specific website. A Virtual Credit Card (VCC) functions just like a normal Credit Card, though it’s generated in a virtual environment.

virtual credit card

As the name suggests, this a credit card that is not in hard or plastic form. Our normal credit cards are actually information sources in electronic format which we can swipe and pay by. But as on internet, it is not possible to swipe the card, some unique information needs to be provided at the time of purchase (like CVV number and card expiration date) which can be stolen if the payment system of the merchant from whose site you are shopping is not secure or is hacked. To avoid this, your bank can give you a credit card number with one time information with as small limit as you require for your purchase. You can enter this information on the merchant’s site to make the necessary payment. As this information is valid for one time purchase, though anyone steals this information, no worries!!

Advantages of a Virtual Credit Card

Following are the advantages of transacting online using a VCC:

  • A Virtual Credit Card is only valid for one time transaction. It automatically expires once a transaction is successful. This means, no one can use a particular Virtual Credit Card and its number more than once.
    A User can set his/her own limit on the VCC Amount/Currency. For Example, if 100 USD equals to 4500 INR (depending on the exchange rate), than user can set his/her currency limit to 4500 INR, when he/she wants to transact/shop online for 100 USD. Because of this feature, the merchant website can’t charge more than 100 USD in any condition, from user’s bank account.
    Almost all Payment Gateways recognizes a Virtual Credit Card as a real Credit Card, and because of this any user can shop/transact online, if he/she don’t possess a real Credit Card

    • There are a few disadvantages:

    There could be delay in shipping merchandise, as the merchants might wait to receive the money before dispatch of goods.

    Also, you need to complete a transaction within 24 hours. So, forget about paying at your leisure. Once a transaction has been completed successfully, the card cannot be used a second time. There is also a spending limit of Rs 50,000 with most banks that you need to keep in mind.

    Don’t use the card when…

  • You will be required to present your actual plastic Card to receive your purchase, e.g. for purchase of some airline and movie tickets – check each merchant’s policy carefully before you purchase!
    Card is to be used for recurring or installment payments

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