What is a Virtual Credit Card Number? How VCC Technology Helps Consumers Avoid Fraud

Now, if you buy into the premise behind The Matrix, we’re all living in some virtual dreamland. Is life but a dream? 

Not to those of us who feel we exist. But many credit cards do, indeed, live that double life by having both real and virtual account numbers. 

A virtual credit card number is a temporary, unique number generated for online transactions to protect your real credit card information from fraud.

And those virtual numbers pack a punch when it comes to security and convenience. So, get ready for a mind-blowing ride through the alternate reality of virtual credit card numbers. 

You’re about to see the credit card universe in a whole new way!

Alright, you adventurers, let’s dive into the basics of virtual credit card numbers. In fact, we’ll see how these little varmints work and why you may want to use them all the time to gain a little peace of mind.

How Issuers Generate Virtual Credit Card Numbers

Virtual credit card (VCC) numbers don’t automatically come with your credit card. Card issuers or third-party applications generate them at your request. Through the marvels of technology, these temporary numbers get hitched to your physical card. 

You aren’t married to these virtual account numbers — think of them as brief flirtations. 

VCCs have pretty short shelf lives, sort of like mayonnaise you leave out too long. They either expire after a certain time frame, are only good for one transaction, or go inactive once they’ve reached a specific purchase limit. 

And you can always get a fresh number when you need one.

How They Differ From Physical Credit Cards 

A VCC is not like the account number on that trusty piece of plastic you have in your wallet. These virtual numbers work when you make online or remote transactions. 

They were designed for those times when you aren’t at a cashier, yet still need to pay without putting your actual card at risk.

The short lifetimes of VCCs are what makes them so convenient. While the number on your physical card is permanent (until you get a new one), a VCC more is like a snowman that will melt away before too long.

Common Uses of Virtual Credit Card Numbers 

You can use a VCC to pay for online shopping or subscription service trials. Whether you’re grabbing a new gadget or signing up for the Horror Channel, a VCC adds a layer of protection so your real credit card information doesn’t end up floating around the internet. 

Another great use is in protecting your wallet from things like data breaches. If one of those shady hackers gets hold of your VCC, they’re out of luck since you can set them for single use only.

You also may want to rope in a VCC when you get approved for a new credit card. Take Lucy, for example. She ordered a new credit card but didn’t want to wait for it to show up in her mailbox. She wasn’t about to postpone her shopping for a diamond necklace, so she requested and got a virtual card number. 

The VCC let her shop on the internet without fretting about some sidewinder stealing her real card details and sticking her with the bill.

By now, you know that VCCs can help protect you and how easy they can be to get. But where do you go? 

Keep reading to learn how to obtain and use VCCs through various providers and platforms.

Through Your Financial Institution

Most of the major banks and credit card companies provide a VCC service, so you may not have to look any further than your issuer. 

All you have to do is log onto your online account or jump onto your bank’s mobile app, and voilà — you can see if your institution offers a VCC. 

If you have a mobile banking app, you may have the option to request a VCC number from your smartphone.

If it does, you’ll need to access that online dashboard or app when you’re ready to shop online or sign up for something. It should be just a matter of tapping a few icons, and, quicker than a jackrabbit, you should have yourself a fresh number.

Third-Party Virtual Providers 

You have alternatives if your bank doesn’t provide VCCs. There are a whole slew of third-party apps and services that will do the job. 

They can generate VCCs for you, and some of them even let you link multiple credit — or even debit — cards to one account. 

These services are great if you like to keep your finances spread out, but still want to have the security of a VCC. You will have to enter your cards in the app at just one time and then generate VCCs as needed.

Setting Up and Managing a VCC 

It’s easy to set up VCCs with your issuer or a third-party service. You usually get a convenient dashboard or an app interface where you click a few buttons to create the number. 

You can obtain a number instantly, whether you need to make one-time purchases or shop with particular merchants.

Let’s return to Lucy. She had to shop online urgently and was not in the mood to expose her actual card details. Lucy opened her card app, clicked “generate VCC,” and voilà — she had herself a brand new virtual number in seconds. 

She used that number for the transaction without any hiccups. The real card remained tucked away while her virtual number did the heavy lifting. And since she set it to single use, she won’t have to worry about that number being used for anything else.

As you’ll see, VCCs can reduce your vulnerability to fraud and help you control your spending. But you should also know why they are so effective.

Security for Online Transactions 

By using a VCC, you don’t expose your actual credit card number. The merchant sees only the temporary VCC number, keeping your real details under wraps. It’s an effective decoy.

The merchant sees a unique number tied to your credit card, but to anyone else, it’s worthless. The VCC may work for a single transaction or within the limits you set. After it expires, the VCC has no value to anyone — especially cybercriminals.

If someone tries to swipe your VCC info, they’ll just be wasting their time. And you needn’t concern yourself with your real card info entering the cybersphere.

Greater Spending Control

VCCs can do much more than just secure your online and remote transactions.

You can also use them to set a limit on how much you’re willing to spend with a certain merchant — or on a particular purchase. 

Once that limit is reached, the VCC is no longer valid. A VCC can also be limited to a single use or even a specific merchant.

Businesses may provide VCCs to employees to maintain more spending control and prevent anything that comes close to an unauthorized purchase with company funds

Reduced Risk of Fraud and Identity Theft 

VCCs can be a solid barrier to credit card fraud. Scammers may get nothing but a number because the VCC most likely will expire before they can commit fraud.

It’s easy to understand how it works. You can request a virtual number, set it to one-time use, and use it for your online shopping.

Merchants process your payment using the VCC while your real card number remains safe. 

Anyone who tries to use the VCC after will have their transactions declined.

While VCCs offer security, there are some limitations to their use. Let’s nail those down.

Not Always Accepted by All Merchants 

Now, before you gallop off with your new virtual credit card number, remember that some merchants may not exactly roll out the welcome mat. 

With international vendors, in particular, your VCC is as welcome as a cowboy at a ballet recital. They’re not as universally accepted as your regular ol’ plastic.

Another hitch is with subscription services: Some of these require the same card to stick around for months, if not years. So, if the life span of your VCC is pretty short, it may expire before the next billing cycle, and then you have to wrangle with customer service to get it all squared away again.

Impact on Refunds and Disputes

Here’s another bump in the road: Refunds can get a little messy if your VCC has already terminated. If the merchant tries to send your cash back to a VCC that’s expired, well, you might find yourself in a wild goose chase tracking down that cash. 

Some banks have workarounds for this, but it’s best if you know what you’re getting into beforehand.

Note that if you use a virtual credit card number during a transaction and want to return it for a refund, the process can get complicated if the VCC is no longer in use.

Disputed charges could also become more difficult if you’re working with a temporary number. Because VCCs do not last forever, finding out which number was associated with which transaction might require some extra detective work. You may even want to consider taking store credit if you shop at the store frequently.

If you dispute a charge after your VCC has expired, you may have to do a bit more wrangling with your financial institution to set things right. It’s not impossible, but it sure isn’t as clear-cut as disputing charges on your regular card.

Limited to Online and Remote Purchases 

These days, VCCs make sense for purchasing items in the digital world, but when it comes to physically walking into a store — not so much. 

These numbers are strictly for online or remote purchases, so if you think swiping your card in person is a certainty, then you’re simply out of luck. 

When you actually have to produce the physical card, say at the hotel counter to book a room, or when renting a car, the VCCs just won’t work. Why? Merchants want to see it in real life and not through some virtual stand-in. 

For keeping your money safe and sound, VCCs are like guard dogs for your online transactions. The virtual numbers add another security layer by covering your actual credit card number in a veil of secrecy away from other prying eyes and would-be thieves. 

Whether you shop online, subscribe to services, or merely try to protect personal information, a VCC is a straightforward, really powerful way to keep the bad guys behind.

The catch is that while they are incredibly useful in making purchases online, they have a few caveats: Not all merchants take them, and you can’t use them at brick-and-mortar stores or in situations that require an actual card. 

With the proper knowledge and a little management, though, VCCs allow your real card to be safe, secure, and protected from the world, much like a horse in its barn during a thunderstorm.