Virtual Debit Cards: Everything You Need to Know

What are Virtual Debit Cards?

The digital age is upon us, and with it have come many additional avenues of conducting everyday business. While the digital renaissance may have made life a bit more fast-paced and complicated, it has also made certain aspects much easier and convenient. One of those new elements of convenience is the virtual debit card. What was once siloed to a plastic square with numbers that was absolutely vital in order to make a transaction has now been transferred to the ease and ubiquity of a mobile phone application.

Virtual debit cards are created from online banking accounts, and they provide additional layers of security to users when making online transactions. Users do not receive a physical copy of a virtual debit card as it is only meant to be used online. 

The virtual card is intended to ease worries of online shoppers as the information is not the same as the data on their physical debit card. This provides an extra layer of security and convenience should a fraud be detected. Everything is encrypted and stored online and/or on your mobile device, so retrieving, remembering, and protecting your data is easier than keeping track of and protecting a physical card. Additionally, virtual debit cards can be stored in a phone’s virtual wallet and used to complete transactions using touchless payment systems.

Now that you understand a bit more about what a virtual debit card is, let’s learn more about how to get one, how to use it, and the pros and cons of using a virtual debit card.

How to Create a Virtual Debit Card

Generating a virtual debit card is simple and fast. Users can get virtual debit cards through their current banking providers or by finding virtual debit card providers online. Unlike credit cards, the application process of a debit card is quicker and easier as debit cards require users to have the funds they are planning to spend already. Depending on the company, users may be able to generate virtual debit cards through their bank’s app or online portal. If you have specific questions about how to generate a virtual debit card with your bank, it’s best to call them directly.

Once you are sure you would like to generate a virtual debit card, look at your bank’s mobile app or website and follow the prompts for how to create a virtual debit card. This will take you through a series of confirmatory questions and culminate with you selecting the expiration date. Once all steps are complete, you should be issued a virtual debit card in a matter of seconds as the digital link will be instantaneous.You should also receive a confirmation email, so be sure to check that your email on file is current.

How to use a Virtual Debit Card

Using a virtual debit card online is as simple as using your physical debit card. Simply enter the card’s number, CVV, expiration date, cardholder name, and address, and you’re done! 

Additionally, some merchants with contactless payment systems are beginning to accept virtual debit cards as a means of payment. In order to use your virtual debit card at a brick-and-mortar business, you have to download it to a virtual wallet on your phone, such as Apple Wallet or Google Wallet. 

Once you are ready for your in-person transaction, open your phone, pull up the card, and hold the phone over the tap-to-pay system to complete the transaction. Before you buy, be sure to confirm that the merchant accepts this type of card before paying.

Pros and Cons of Virtual Debit Cards

Pros:

  • Virtual debit cards are very safe to use as you only have to share the virtual card number, not the main account number, when making a purchase.

  • The virtual debit card can be canceled at any time without closing your checking account.

  • You can set a daily spending limit on your virtual debit card, giving you greater control over your spending. This is also ideal for parents who want to teach their children the basics of finances — but within set limits.

Cons:

  • When you only have to enter a few numbers online to purchase something, it can be hard to think of money you spend as “real.” 

  • It can take time for your account to reflect the expenditures on your virtual card, and you may lose track of the actual money you’ve spent. This delay can decieve you into thinking you have more than you do in your account and lead to overspending.

  • For items that require your debit card to pick up, not having a physical card that matches the number of the virtual card could cause delays and inconveniences.

Virtual Cards in Action

Virtual card numbers are not just for debit. Businesses with dash.fi accounts can create unlimited virtual card numbers for a single credit account. Learn more here.


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