We at Loan Singh, are not just helping our under-served customers to avail loans, are also an aide to keep our customers abreast with the latest relevant technological advancements in the financial world. With this article, we expect to help our customers understand the basics of Virtual Credit Cards.
We all love online shopping! We spend our precious time and mobile internet data browsing on apps of Myntra, Amazon, Flipkart, etc. These e-commerce companies offer us the convenience to browse through hundreds of catalogs to find products that match our budget, color, size, these help us to compare prices and pay with ease, as well; making online shopping a breeze without the long queues at the checkout counters of the nearby Mall. This same facet of convenience is applicable for grocery shopping, booking flight tickets, payment for utility bills, buying movie tickets, etc.
Just imagine the volume of transactions that happen every day over the internet across various digital marketplaces. Online shoppers provide their personal information such as credit card or debit card details, their full name, card number, CVV (Card Verification Value) number, and more; sharing sensitive information online mindless to the possibility of data theft, forgery or identity theft. Although safety measures are in place, like One Time Passwords (OTP Passwords), there is a need for extra security from the card user’s end.
With more and more digital innovation expanding in India, credit card companies are giving their users a plethora of financial products to continue using their credit cards with less of a worry. One such innovation was the use of EMV chips on debit and credit cards. Although cards with EMV chips continue to function in India, it might fail while dealing with international transactions. Hence the separate cards for overseas transactions. Here is where an idea for a Virtual Credit Card was devised.
What is a Virtual Credit Card?
A Virtual Credit Card is an add-on card issued on your primary credit card. Unlike your primary card, it does not enjoy a physical card presence. Just like regular card, it has a 16 digit number with an expiry date and a CVV number which can be viewed online. It enables you to transact online with a credit limit of your choice. It is a randomly generated number associated with your actual credit card. Each card issuer sets a maximum amount limit to the virtual credit card along with setting-up the card expiry date as per their respective policy. It can be topped-up to any limit with the requisite amount credited from the card holder’s bank account or credit account. To an online merchant, it looks like any other credit card number. And yet, you do not share your actual credit card details online or get your credit score affected.
Features of a Virtual Credit Card
Following are the features of a virtual credit card
- It is a prepaid credit card which can also be used as a debit card
- Very good for online usage to counter the fear of compromising your card information
- In case of theft/fraud, only the loaded balance and preset daily usage limit is compromised
- Offered also by online wallets to allow transactions with cross platform merchants
- Minimum transaction limit on a virtual credit card can vary between Rs.100 to Rs.50,000 per transaction per day
- Each 16 digit code is for one time use only, and the entire balance can be used for a single transaction
- If there is any balance pending, it gets credited back to the card holder’s bank account/credit account
- The Virtual Credit Card is usually valid for 24 to 48 hours
- As Virtual Credit Cards do not have a physical existence, they cannot be cloned – making it highly secure for all digital transaction purposes
- The transactions made are visible in your primary credit card statement
- Ceasing operation of a virtual credit card can be done on the issuer’s website within a few hours
- Virtual credit card cannot be issued to a supplementary card holder – only to primary
- Most card issuers issue it as an internationally valid credit card
Virtual Credit Cards in India
Still to hit the popularity bug in India, the virtual credit is currently issued by few banks and mobile applications. Some of the ones used in India are mentioned below
Virtual Card by State Bank of India
SBI customers can log on to their Net-banking account and generate a free virtual card with an amount ranging between Rs.100 to Rs.50,000. The card expires after 1 successful transaction or 48 hours since creation. They can only be used domestically. The transactions are approved by sending an OTP code to your registered mobile number.
Virtual Credit Card by Udio Wallet
Social Mobile Wallet, Udio offers a free virtual visa card which can be used on nearly all online stores in India. It also offers a physical card (with charges). The physical card is for purposes of swiping at POS terminals. Udio has teamed up with RBL bank and runs promotions and discounts on the virtual credit card.
Pockets Wallet by ICICI Bank
Backed by ICICI Bank, Pockets is a wallet based service that anybody can sign-up and make use of. A free virtual visa card is offered with the wallet which can be used to make payments across online marketplaces in India. It also offers an option to get a physical card linked to the wallet.
Slonkit by DCB Bank
Slonkit offers a physical card. Nothing virtual in that; but, it still offers a free prepaid visa credit card which is re-loadable by using the Slonkit App. The idea is to teach money management to youngsters. The app also offers mobile recharges, tracking of card transactions and creation of budget for money saving. One cannot withdraw cash from an ATM using the Slonkit visa card.
Digipurse Wallet by Union Bank
Similar to Pockets, this app is more of a virtual bank account which can be loaded from a normal debit/credit card and then the wallet’s card can be used for payments. International transactions are also possible via the Digipurse wallet.
Being a popular wallet app, Oxigen provides exclusive cash back offers. It also offers a free virtual visa card which can be used to make purchases on any shopping portal in India.
Lime Wallet by Axis Bank
It is a wallet service similar to Pockets. A free virtual credit card powered by MasterCard is offered to the wallet users. The card can be used at any online marketplace in India with no international usage allowed.