Virtual cards, how they are, how they work

Virtual cards have become a very interesting and well accepted payment element through the Internet.

The year 2015 closed with record sales through the Internet. This reality has been happening year after year in the last decade, we increasingly buy more and more over the Internet and we increasingly give more credibility to everything that has to do with the commercial on the network.

Obviously, payment mechanisms take on special relevance in a context in which online transactions are now a daily occurrence. Today there are a large number of differentiated methods, to which have been added the options that mobile devices have brought with them, options that are still in the growth phase but with a great future.

Among all these payment options, virtual cards continue to be an instrument of choice for the average user, which also has very interesting advantages over other options such as other bank cards.

What are virtual cards?

The average user has begun to overcome the distrust in Internet purchases as far as the product is concerned. We no longer have so many doubts about whether the product will be as we expect or will have the features and qualities that are expected. However, the main doubt is still related to payment methods and the security they provide.

Obviously everything that has to do with providing bank details to a third party is not comfortable. In this sense, the use of traditional cards or credit cards for payment has decreased significantly, and distrust has grown almost proportionally.

Virtual cards come precisely to fill this gap and boost user confidence in purchases through a secure payment model that does not compromise the rest of your financial products.

Basically, a virtual card is a payment product that does not have the physical conditions of credit or debit cards. That is to say, although in some cases these cards do have a physical body, they do not have a magnetic stripe or any other system that allows them to be used outside the scope of Internet payment.

In these cards we will be provided with a card number, an expiration date and a control number. These three pieces of information are the basic ones to make purchases through the network, although they can be complemented with other barrier measures such as, for example, confirmation through a PIN or confirmation through a code received by SMS.

Obviously, as you can understand, this type of card cannot be used physically, will not be recognized by a cash dispenser, cannot be swiped at a POS and cannot even be used for face-to-face transactions.

Another characteristic of these cards is that they generally also respond to the condition of prepaid cards. In this case this applies in such a way that the virtual cards can only dispose of the money that has been indicated and loaded on their balance previously. Once the card has been used up, it is not operative in any way, and the only way to use it again is to reload it through the associated electronic banking procedures in each case.

This provides a very high level of security since at all times we can only use what we are going to spend, and even in the event that the card falls into the wrong hands, it is not possible to access more balance than was loaded on it in any case. Obviously here we must take into account that if we have lost all the bank details, and all our security barriers have been broken, it is also possible to have access to the recharge of this type of cards, but, at that point the cyber criminal does not really care about these cards but about the bank accounts themselves.

The advantages of virtual cards

The truth is that we can find a large number of advantages in the use of these cards when they are intended for what they are designed for.

The first great advantage lies in the fact of absolute control over the purchase. In this case we can clearly determine what we are going to buy and recharge the card exclusively with its cost. This means that we exercise a very exhaustive control, obviously more than when we buy with a credit card whose limit is higher, and in addition, it does not run out beyond our decision and the credit limit itself.

The virtual card helps in this sense to a more reflexive purchase model. This is very important in a commercial environment such as the Internet where the ease of shopping makes thoughtless buying very easy.

From the point of view of security, the virtual card wins many points over other payment models such as the credit card, or even certain payment gateway systems.

Firstly, because it is a payment model in which we are the ones who decide the amounts on the card, so it cannot affect the rest of our financial products in any way.

Secondly, because there is no physical loss of the card.

Thirdly because it has all the payment security features of any other card model but with the particular conditions that the fact of being virtual confers to it.

To all the above we must add the fact of being a specific product, oriented for a specific purpose and therefore perfectly equipped for this purpose.

If to all the above we add the absence of costs, since it is usually a free issuance card and without maintenance costs, and on the other hand without commissions on the operations carried out, we understand that the advantages are really wide with respect to other payment methods.

Disadvantages of virtual cards

Actually, the main disadvantages of virtual bank cards have to do with their own strengths. That is to say, those characteristics that make them valid for a specific operation but at the same time limit their versatility as a financial product.

Therefore, the main disadvantages of virtual bank cards are based on issues such as not being able to be used for anything other than Internet purchases, depending exclusively on recharges made for the availability of the balance, not functioning on credit in any case, and, very importantly from the point of view of security, sometimes being able to be operative simply with basic data. This last fact is corrected in many cases with other barrier methods in combination, such as PINs or SMS, but not always. This is why we must control the data on these cards very carefully, especially when there is a physical virtual card that has the main data stored on it.

Are virtual cards worth it?

Absolutely yes. There may be differences between the offers of financial institutions, there may be some products with better features than others, but overall, as a payment model, virtual bank cards are probably one of the safest, most effective and most suitable options for our pocket, as far as buying online is concerned.