What is a Virtual Credit Card, and How Does It Work?

Getsby Blog Team | Jan 15, 2025

In recent years, we’ve seen a noticeable increase in digital payments and a distinct shift toward becoming a cashless society. With all of the convenience debit and credit cards offer, it’s easy to forget about the associated security risks.

In 2022 alone, the total value of credit and debit card fraud in Europe was worth €4.3 billion, highlighting ongoing issues with transaction security.

Virtual credit cards are innovative solutions that offer more security than traditional payment methods. In this post, we’ll reveal everything you need to know about virtual credit cards, including how they work and the types available.

Let’s get straight to it.

What are the best alternatives to traditional Virtual Credit Cards?

With the limitations posed by VCCs, it’s natural to search for an alternative. Prepaid Virtual Cards are a convenient way to make transactions without worrying about your credit score. Because you preload them with funds, there’s no need to connect the card to your account, which ensures total privacy.

There are two types of prepaid virtual cards to choose between:

Reloadable Virtual Credit Card

A prepaid reloadable VCC is a convenient option if you want a secure payment method for daily spending. These cards are prepaid only, which means you’ll need to preload them with funds before making online payments.

As long as the card has available funds, you can make multiple transactions, and it lasts for a set time. Once the expiration date passes, you’ll receive a new card and can continue spending.

Pros:

• Security: An undeniable benefit of reloadable virtual cards is their security. Most use advanced features, like MasterCard 3D Secure 2.0 and tokenization, to add extra layers of protection to your transactions.
• Budgeting: Overspending on a traditional credit card is easy because you can buy first and think about repaying it later. A prepaid virtual card lets you manage your money effectively, as you need to top up the card with funds.
• Convenience: You can load the card multiple times, making it ideal for managing subscriptions and general spending.
• Flexibility: Reloadable virtual credit cards work for contactless payments, too, meaning you can spend in-store and still ensure your transactions are secure.

Cons:

• Spending Limitations: You can use a reloadable card worldwide, but most are only compatible with merchants that accept MasterCard. This isn’t a problem in most cases, as millions of merchants worldwide do, but you might struggle with smaller merchants.
• Prepaid: Some people love using prepaid cards, but if you want to make a large purchase and pay it off over time, you’ll need to use a traditional credit card.

Single Load Virtual Credit Card

A single-load virtual card might be your best fit if you’re looking for an additional layer of security. These cards function similarly to reloadable cards, with one key difference: you load them one and will need to order and activate a new card once the balance is gone.

These cards are easy to use, and activating a new one takes minutes. Single-load virtual cards are the most secure option if you want to try new subscriptions without renewal charges or invest in cryptocurrency.

Pros:

• Ultimate Security: The card expires after a single use, which means you can take advantage of higher security with fewer risks of data breaches.
• Privacy: All prepaid cards offer high levels of privacy, but single-load options safeguard your personal information.
• Budget Control: You won’t need to worry about overspending as the card is preloaded, which prevents impulse purchases.
• Convenience: You can use these cards to make online purchases and spend in physical stores that accept MasterCard.

Cons:

• Limited Usage: Single-load cards aren’t ideal for managing regular payments, and you’ll need to order a new card once the balance runs out.
• Less Flexibility: A reloadable option might be the most flexible if you use a virtual credit card frequently.

Who can benefit from VCCs and Prepaid Virtual Cards?

Anyone can benefit from a prepaid card because it’s a secure way to spend money. Instead of using the same card to make multiple transactions, you can protect your financial information and reduce the chances of falling victim to fraud.

If any of the following apply to you, a VCC is a wise decision:

• Online Shopping: If you enjoy shopping online regularly, a traditional VCC or prepaid card can protect you from fraud and prevent unauthorised charges.
• Travel Enthusiasts: Travelers who book hotels, flights, and other services online can use prepaid cards and VCCs to ensure their financial data remains secure.
• Businesses: If you own or manage a business, your employees can use VCCs for expenses and corporate spending.
• Privacy-Savvy People: For individuals prioritising privacy and security, prepaid virtual cards offer an excellent solution to keep payment information safe.

Are Virtual Credit Cards the future of payments?

Virtual credit cards will continue to play key roles in online and in-store spending habits. Their added security means your virtual credit card information is more secure than traditional credit cards, dramatically reducing fraud risks.

However, Prepaid Virtual Cards are innovative spending solutions that provide absolute security and seamless control over your spending habits. If you’re interested in seeing how Getsby cards can integrate with your daily activities, please feel free to contact us with any questions.

If you’re ready to experience the safety and flexibility of virtual card transactions, please apply today – it takes a couple of minutes.