Why digital and virtual bank cards are safer than real ones

Fortunately, there are easy tools that may increase security when using bank cards. Known as virtual or digital bank cards, they assist protect your actual card number and reduce the chance of fraud in case your payment information is compromised.

What are digital or virtual bank cards?

Virtual and digital bank cards are unique 16-digit payment numbers which are tied to your primary credit account but are only in electronic form. They permit you to make purchases online or by phone without revealing the number and other data associated together with your physical card.

Virtual bank cards

Virtual bank cards are essentially temporary or one-time card numbers generated specifically for online purchases and subscription services. Because they only pass on this unique number and never your actual bank card number, they function a buffer between you and the merchant – or any malicious actors who might intercept them.

Virtual cards typically have spending limits and expiration dates or are blocked after a single transaction, limiting the damage a cybercriminal could cause. And for those who cancel a virtual card, your bank card account will still be operational.

Your bank card provider may offer virtual cards, although each provider typically has its own settings, limits and rules.

Digital bank cards

Many consumers use digital cards stored in mobile wallets resembling Google Pay or Apple Pay for the convenience of using their phone and leaving their wallet at home. But these cards have one other profit: They provide an extra layer of security between your credit account and potential online threats by providing a tokenized version your bank card number.

Although no payment method is foolproof, virtual and digital bank cards can provide an extra layer of security when shopping online. Many permit you to set spending limits, generate unique card numbers for specific purchases, or use separate card details for subscription services. This means less information is shared with merchants, limiting your risk within the event of a knowledge breach.

However, virtual and digital cards should not ideal for each transaction. Using a virtual card when booking flights, hotels, automobile rentals or other travel services may cause difficulties if it is advisable cancel or change your reservation. For these purchases, using your regular bank card is the more practical alternative.

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Simple habits that may improve payment security

You could make using virtual and digital bank cards even safer by following some basic precautions that apply to online payments of any kind:

• Use cards with low balances to limit how much could be charged without additional approval
• Enable transaction alerts This means you will probably be immediately notified of recent purchases and might quickly discover suspicious activity
• Use a password manager and multi-factor authentication (MFA) to raised secure access to your bank card account.
• Use effective password hygieneincluding strong passwords and biometric authentication when possible
• Monitor your credit rating by repeatedly checking your credit reports and checking for unknown accounts or inquiries.

For additional protection against payment and other types of fraud, consider Equifax Complete Protection. This digital subscription service offers a password manager, social media monitoring, data encryption with a VPN, credit monitoring, parental controls, device protection, and identity recovery within the event of identity theft – all for just $34.95 per thirty days.

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About Michael McCullough

Michael is a financial journalist and editor based in Duncan, BC. He is the previous editor-in-chief of Canadian Business and editorial director of Canada Wide Media. He also writes for The Globe and Mail and BCBusiness.