Virtual Credit Card Definition

Merchant Account Virtual Credit Card Explained

What is a virtual credit card? A virtual credit card (also known as a “virtual account number”) is a randomly generated card number that is linked to an actual credit card account and can be used to make online payments just like a real credit card. As a risk-reduction measure, some virtual credit cards can be customized to include a credit limit or expiration date of the cardholder’s choosing. Virtual credit cards are available to businesses and consumers, but card issuers may choose not offer them to cardholders who do not have a clear need for them. Some card issuers may not even offer virtual credit cards, as demand for the service has been unreliable in recent years.

For merchants, virtual credit cards provide a level of protection between their actual business credit card accounts and their suppliers and partners. Virtual credit cards can minimize the damage stemming from an unethical business partner abusing your business’s credit card number, or from a hacker intercepting that card number. They can also serve as a faster, easier alternative to ACH payments or physical checks. Since virtual credit cards are linked to real business credit card accounts, they can often generate rewards or cash back just like the cards they represent.

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