The financial industry has changed drastically in recent years and how money was handled and exchanged 10 years ago now seems prehistoric, especially since the pandemic which has rendered cash obsolete. One recent development which is important to be aware of is the rise of virtual cards, which can be beneficial for both individuals and businesses, especially in a time where cybercrime is on the rise.
So, what exactly is a virtual card? Essentially, these are designed for online use and act like a disposable version of a static or debit card. As opposed to regular cards which always use the same card number, security code, address and other key data, a virtual card uses dynamic information so that each time it is used, the verification data is different. This can greatly reduce the likelihood of credit card fraud and help people and businesses to transfer money with confidence.
For individuals, you no longer have to worry about entering your card details on a website because you know that the information that is stored can only be used for one transaction. Online retailers will often store customer data for repeated use which can be convenient but also poses a security risk as if there was a breach then a hacker could get access to your sensitive information. These attacks have been on the rise in recent times, so you will want peace of mind knowing that your data is safe which you can get with a virtual card.
Virtual cards are also beneficial for B2B payments too. Virtual cards can improve accounts payable (AP) processes and streamline what can be a stressful area of the business while also offering greater protection than you would get with traditional business cards. Payments can only be used for designated scenarios, such as AP payments or online payments with randomly generated data and designated expiry times.
Companies are also able to better control spending with virtual prepaid cards with each card valued at a specific amount for individual suppliers with instantaneous settlement, which can be useful for strengthening relationships.
Virtual cards are a fantastic development in the financial world in recent times and are likely to be much more common moving forward, especially with the continued move away from cash and the rise of cybercrime. Virtual cards can provide superior security for businesses and individuals as well as bring a wide range of benefits to businesses looking to improve how they exchange money.