A Virtual debit card is an online account, which is used like a normal debit card to make purchases online. A virtual debit card does not come with a physical card. You only use it online, and you cannot use them for swiped transactions. One popular example is Paypal virtual debit card, which is a free virtual debit card.
Virtual debit cards have been commissioned due to the increasing popularity and trend of online shopping, and other transactions that use the internet. Most virtual debit card accounts come in a paper or a form issued through your email, wherein you will see your Account Number, Expiration date, and verification code that you can use whenever you make purchases online, by phone, or even by mail order. Most virtual debit card is also a prepaid virtual debit card.
Two types of Virtual Debit Card
- Fully Virtual Debit Card – does not come with a card
- Partially Virtual Debit Card – still comes in a plastic card
Features of a Virtual Debit Card
- Virtual debit card is not associated with the physical card although some companies that offer virtual debit cards issue an actual card making it a ‘partially virtual debit card’. This physical card though does not contain a PIN, and cannot be used in over the counter transactions or physical point-of-sale purchases.
- Virtual debit cards offer low charges. This is due to a large volume of online transactions that are fairly comprised of small payments per customer
Advantages of Virtual Debit Card
- One advantage of using virtual debit card is it makes payment convenient. It can be used almost anywhere in the world where internet access is available. It can also be used for purchases over the phone.
- A big plus is it makes the user worry-free, because you do not have a physical card, you have no chance of losing it, so your account remains intact.
- Virtual debit card is also a type of debit card, in which it allows you to control your spending, since you can only use the account until it runs out of fund.
- Very low charges can be expected from virtual debit cards. It also does not have a periodic charge unlike credit cards. The companies offering these are able to earn their revenue by an interchange fee on every transaction made from their system.
- Good virtual debit card companies have systems that automatically fill out the shipping and billing forms upon checkout, thus protecting you against fraudulent sites like fake eBay and the like.
- Some virtual debit card systems generate a unique and random Virtual Card Number in place every time you make a transaction online thus protecting your real debit card number
- Better security is in place since most transactions using virtual debit cards would require inputting the security image to avoid automated theft. Another security image or code can be applied to the system if this is being offered by the company. This would mean additional security whenever you log-on to your account and check out payments.
Disadvantages of Virtual Debit Cards
It does not have a physical or plastic card, and you cannot use it for face-to-face transactions which require you to present and swipe your card.
How to Get or Buy Virtual Debit Card
Anyone can apply for a virtual debit card. If you are applying for a virtual debit card from a bank or other financial institutions, you can ask for a form that you can fill out. Once they verify and save your information, they will issue you a letter, containing the PIN which you can use for transactions.
If you are applying online, it is easier. Just go to the website of the company offering the virtual debit card and fill out the application form online. The account number, expiration date and verification code will be sent to you.
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