Credit card frauds have made headlines recently across the globe and India has not been an exception. Most of these happen as the details are hacked while a person does online transactions or are obtained from magnetic strips during a physical transaction or through skimming.
Though there are constant efforts by banks and other stakeholders to securitize these details, pilferage happens as fraudsters are also at work. Moreover, if a fraudulent transaction is carried out through your credit card, banks raise the claim against the customer in most cases. So does that mean you stop
using technology? Of course, not. One solution to this is using a virtual card, which does not require you to enter your credit or debit card details at all, when shopping online.
What are virtual cards?
Virtual cards are issued by a few banks and individuals can get more than one card at a time. These can be obtained by registering with the bank that has issued you a credit card. You need to do a one-time registration after which you will get a 16-digit number along with a CVV2 number (this is different from the CVV number mentioned at the back of your credit card). This is the number that you would need to key in when doing an online transaction.
This can be generated for one-time use and usually is valid for a short term of 24-48 hours. Usually, banks give an outer limit of Rs.50,000, which is part of your credit card limit, on such cards. Most banks do not levy any extra charge to provide this facility.
How does it work?
The procedure is the similar to that of a credit card payment. Once you have created this number, you can log on to the website where you intend to shop. After you are done selecting the products you want to buy, you will be prompted to make the payment. After you choose your bank, you would be required to key in a number, where you would enter this one-time number issued for the virtual card and the payment will get done.
Watch out for
After the time frame for which it is valid, the card automatically gets cancelled. Usually, the amount that you mention as your virtual card limit is blocked in your credit card. In other words, the limit on your credit gets reduced by the limit you choose for the virtual card. Once the time limit for the virtual card is over, the balance credit limit gets added to your usual credit card limit.
Remember that virtual cards can’t be used to pay instalments or to make payment for orders through email and telephone. No cash can be withdrawn in lieu of the card. Also, if the merchant requires the customer to present the card at the time of actual delivery, say movie tickets, virtual cards cannot be used. Always check with the merchant about acceptance of virtual cards before getting one.