How Virtual Cards & Wallet Payments Actually Work
Virtual card numbers and wallet tokens let you pay without exposing your physical card details. This page explains how they’re created, how they’re secured and when they’re worth using.
Explore Technology & Payments hubWhat Is a Virtual Card?
A virtual card is a card number generated in software – usually in your bank or card app – that can be used for online or in-app purchases just like a physical card. It comes with its own number, expiry date and security code, but is linked to your main account in the background.
Some issuers generate single-use numbers that expire after one transaction. Others offer merchant-locked virtual cards, which only work with a specific store or subscription. The goal is to give you more control over where and how your details are stored.
Security & Tokenisation Basics
When you add a card to a mobile wallet (like your phone or watch), the real card number is usually replaced with a token. This token is what’s stored on the device and sent to merchants – your actual card number stays with the issuer.
Virtual cards and tokens can improve security because:
- You can freeze or delete a virtual card without cancelling the main card.
- Compromised details are often limited to one merchant or one device.
- Additional checks (3-D Secure, biometrics, device checks) can be layered on top.
However, they don’t remove the need for basic hygiene: strong device security, careful app downloads and monitoring your statements for unusual activity.
Common Use-Cases for Virtual Cards
Virtual cards and wallet payments are most useful when you want to separate risk or keep tighter control over how a merchant can charge you. Typical examples include:
- Online subscriptions – using a dedicated virtual card per subscription for easier cancellation.
- One-off purchases – especially on unfamiliar websites or marketplaces.
- Work expenses – separate virtual numbers for different projects or teams.
- Travel services – temporary cards for hotels, car rentals or tours booked through intermediaries.
Some business platforms go further with “card per vendor” setups, making reconciliation and spend limits much easier to manage.
Limits, Fees & Practical Details
Virtual cards usually share the same credit line as your physical card, but may have their own configurable limits. In some cases you can set:
- maximum amount per transaction
- monthly or total spend caps
- merchant category restrictions
Fees are typically the same as your underlying card – FX margins, interest and other charges still apply. Virtual cards are a security and control layer, not a separate pricing structure.
Virtual Cards vs. Traditional Plastic
| Aspect | Virtual / Wallet-Based | Physical Plastic |
|---|---|---|
| Number exposure | Tokenised or app-only; easy to rotate | Printed on card; reused everywhere |
| Control | Per-merchant or per-use limits possible | Global limits only, unless app adds controls |
| Convenience | Great for online, in-app and contactless | Required where wallets aren’t accepted |
| Replacement | Can be regenerated instantly in-app | Physical replacement takes days |
For real product-by-product comparisons of virtual-card features, visit Choose.Creditcard – Technology & Payments hub .
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Part of The CreditCard Collection
VirtualPay.Creditcard is part of The CreditCard Collection — a network of focused minisites operated by ronarn AS. Each page explains one concept (like virtual cards, crypto, loyalty or scoring) and then connects you to independent comparison tools.
We don’t issue cards or process payments. Information here is general, based on typical industry practices, and may not match any specific issuer’s product. Always read the current terms and conditions before applying.
This microsite is connected to the Technology & Payments hub on Choose.Creditcard. Educational only – not financial advice or a product recommendation.
Ready to Compare Cards With Strong Virtual Features?
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