Virtual Credit Card

A virtual credit card offers a safer way to shop online by using a unique digital card number instead of your actual credit card details. This reduces the risk of fraud and unauthorized transactions. You can also get a free virtual credit card with select issuers, subject to their eligibility criteria and terms. Read on to learn what a virtual credit card is, how it works, its key benefits, and how you can get one through Paisabazaar.

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What is a Virtual Credit Card?

A virtual credit card is a digitally generated credit card that allows cardholders to make secure online payments without revealing the details like physical credit card. It comes with a unique 16-digit card number, expiry date, and CVV, similar to a regular credit card, but exists only in digital form.

Unlike a physical credit card, a virtual card cannot be carried in your wallet or swiped at a Point-of-Sale (POS) terminal. It is primarily meant for online purchases made through websites, mobile applications, and digital platforms.

However, note that some card issuers may offer a temporary virtual credit card immediately after your application is approved. You can use this temporary credit card for eligible online transactions even before your physical credit card is delivered.

How Does a Virtual Credit Card Work?

A virtual credit card functions much like a regular credit card during an online payment. The key difference is that instead of entering your physical card details, you use the virtual card credentials generated by your card issuer.

The process generally works as follows:

Step 1: Generate the Virtual Card

Log in to your bank's internet banking portal, mobile banking app or credit card portal. If your issuer offers virtual card, you can generate one instantly by selecting your eligible credit card.

Step 2: Receive Virtual Card Details

Once generated, the issuer provides you with:

Virtual card number
Expiry date
CVV
Credit limit

Step 3: Use the Card for Online Payments

During checkout on an online merchant's website or mobile application, enter the virtual card details instead of your physical credit card information.

Step 4: Authenticate the Transaction

Like a regular credit card transaction, you will be required to complete additional authentication, usually through an OTP sent to your registered mobile number.

Once authenticated, the transaction amount is debited from your linked credit card account. The purchase will appear in your monthly credit card statement.

Features and Benefits of Virtual Credit Card

Some of the features and benefits of these are mentioned below:

Digital Card for Online Use: It is available only in digital form and is designed for secure online transactions.
Protects Your Card Details: Your actual credit card number remains hidden, reducing the risk of fraud.
Customisable Usage: You can set the transaction limit and validity period based on your payment requirements.
Instant Generation: The card can be generated within minutes through your bank's internet banking or mobile banking app.
Easy to Manage: You can create, block, or delete the card online whenever required.

How to Get a Virtual Credit Card via Paisabazaar

Below mentioned are steps to apply for a virtual card online via Paisabazaar:

Step 1: Open the Paisabazaar website or mobile app on your phone or laptop.

Step 2: Navigate to the “Credit Cards” section from the main menu or homepage.

Step 3: Enter your mobile number and complete OTP verification for login/signup.

Step 4: Fill in your basic personal details like name, income, employment type, and city.

Step 5: Compare the available virtual credit card options based on benefits, fees, and rewards.

Step 6: Select the virtual credit card that best matches your needs and click “Apply Now.”

Step 7: Complete identity verification by entering PAN details and doing KYC steps.

Step 8: Wait for bank approval, and if approved, receive your credit card physically or digitally.

You can also visit a bank or card issuer’s official website to apply online for a virtual credit card.

Limitations of Virtual Credit Card

Virtual cards come with certain limitations, some of which are mentioned below:

You cannot use a virtual card at a merchant swipe machine, as it is purely digital
The ones with the short expiration date can cause issues for subscriptions
You cannot withdraw cash using the virtual card

Who Should Use a Virtual Credit Card?

It is suitable for consumers who frequently make online payments and want to enhance transaction security. It can be especially beneficial for:

Frequent online shoppers
Individuals purchasing from international websites
Users subscribing to OTT platforms or software services
Students making online course or examination fee payments
Professionals purchasing digital tools or cloud services
Individuals concerned about online card fraud

Virtual Credit Card vs Physical Credit Card

Before opting for a virtual card, one should know about all the terms related to it and how it differs from a physical credit card. Here are some of the differences that you should know about before applying for a virtual card:

Virtual Credit Card	Physical Credit Card
Account numbers are generated only for a single use, which ensures better security.	Fixed account numbers remain the same from the time of account opening.
Cardholders can select spending limits.	Spending limit settings are available only for selected issuers.
Card can be used across multiple channels, including mobile apps, phone, or websites.	Card can be used for in-person transactions, and selected functions can be done online.
Provides better fraud protection as the relevant card details are stored securely online.	Does not offer the same level of fraud protection and is more prone to card information theft.
Comes in a digital form and is typically valid only for a limited period.	Comes in a physical form and is generally valid for several years.

Top Virtual Credit Cards

A virtual credit card is available in two ways- either directly from the bank’s side if the customer has a credit card issued by one of the banks that provides this facility or by linking a pre-existing card from another bank to an online service. Given below is the list of different banks in India that provide virtual cards:

Card Name	Key Features
HDFC UPI RuPay Credit Card	3% CashPoints on supermarket, groceries, dining, and more 2% CashPoints on all utility payments
YES BANK PaisaSave Credit Card	Add-on virtual RuPay Credit Card 2 reward points per Rs. 200 spent on UPI spends above Rs. 2,000
Kotak UPI RuPay Credit Card	3 reward points per Rs. 100 spent, including UPI, online and international transactions made virtually Redeem the accumulated rewards at a value of 1 Reward Point = Rs. 0.07
IDFC FIRST Digital RuPay Credit Card	3 reward points per Rs. 150 on UPI spends above Rs. 2,000 1 reward point per Rs. 150 on UPI spends below Rs. 2,000

How to Apply for a Credit Card Online?

Step 1: Enter your mobile number

Step 2: Enter OTP to verify your mobile number

Step 3: Explore pre-qualified credit card offers from top issuers

Step 4: Select your preferred card and complete the digital application

How to Apply for a Credit Card Online?

Step 1: Enter your mobile number

Step 2: Enter OTP to verify your mobile number

Step 3: Explore pre-qualified credit card offers from top issuers

Step 4: Select your preferred card and complete the digital application

FAQs

Can I use a virtual credit card for all online purchases?

Yes, it works for most online payments where credit cards are accepted. It comes with a unique 16-digit card number, CVV, and expiry date. However, some merchant categories or international transactions may be restricted depending on your card issuer.

Is it safe for recurring payments?

Virtual credit cards with a short validity period or single-use card number may not be suitable for recurring payments like OTT subscriptions or monthly memberships. If the card expires or is deleted, future auto-debits may fail unless your issuer supports reusable virtual cards.

What happens if a virtual card is compromised?

If you suspect that your virtual credit card details have been exposed, you can instantly block or delete the card through your bank’s app or internet banking. Since your primary credit card number remains hidden, the risk of misuse is significantly reduced.

Can I set a spending limit on my virtual credit card?

Yes, many banks allow you to define a transaction limit while generating a virtual credit card. This feature lets you create a card for a specific purchase amount, ensuring that even if the details are misused, spending cannot exceed the assigned limit.

Will refunds be credited if I pay using a virtual credit card?

Yes, refunds for eligible transactions are generally processed to your linked credit card account, even if the virtual card has expired. The refunded amount is automatically adjusted against your primary credit card, as per the bank’s refund policy.

Do I need a physical credit card to get a virtual card?

In most cases, yes. Virtual cards are usually issued as an add-on or digital version of an existing credit card account. Once approved, you can generate and manage the virtual card instantly through your bank’s mobile or internet banking platform.

Can I get a temporary credit card before my physical card is delivered?

Yes. Some card issuers provide a temporary virtual credit card immediately after approving your application. You can use it for eligible online transactions until your physical credit card is delivered and activated. However, this facility is not offered by all issuers.

Is a virtual credit card free?

Many banks issuers offer a free virtual credit card without any joining and annual fees. However, this facility is subject to the issuer's policy, and is applicable only to select cards.