Different Benefits of Virtual Credit Cards in India

Virtual credit cards can transform the way companies handle and make payments. They can save businesses hundreds of hours and a lot of money on fees and formalities. Let’s look at the main benefits of virtual credit cards and what they mean for your business. 

Virtual credit cards are growing in popularity, with a CAGR of 12% annually. Many financial service providers are coming up with new credit cards every year. Let’s learn how virtual credit cards work and the benefits of having a virtual card in detail.

How Do Virtual Credit Cards Work?

To put it simply, virtual credit cards are real credit cards that only work online. Virtual credit cards have random 16-digit numbers, a card verification number, and an expiration date. They work like traditional credit cards, but you don’t need a physical card. Virtual credit cards are made by Mastercard, Virtual Visa card, and American Express and can be used anywhere you can use a credit card.

But what makes these cards different from real credit and debit cards is how easy they are to use. Most importantly, you no longer have to depend on your bank. You can choose the currency, limit how much you can spend, and choose the types of stores where the card can be used.

There are many compelling reasons to switch to virtual payment cards as a means of payment for your company’s suppliers and merchants.

Virtual vs. Physical Cards

Virtual credit cards improve their plastic counterparts’ capabilities in virtually every way. In 2022, the global market for virtual credit cards will be worth $411 billion USD.

Since everything is done online, you only have to tap a few times to add money, make transactions, and pay suppliers or buyers. Therefore, you are not tied down to one place, nor do you have to waste time sitting in a bank while they process the tedious paperwork. Because who has the time?

The 16-digit number on the virtual card is generated only for the transaction between the user and the recipient.

So, it is very safe because it protects both enterprises and buyers from beginning to end. This is better than traditional payment methods like ACH or cheques, which have more security flaws, because you don’t have to give out your bank information to complete the transaction.

Benefits of Virtual Credit Cards

There are several advantages to using virtual credit cards. Here are some of the top benefits: 

1. Better Safety

With the known security flaws of traditional bank account cards, payment fraud is more likely to happen with physical cards.

People think virtual cards are much safer and more secure because you can limit how much you can spend ahead of time. You can close your account at any time with a button if you are worried about your information getting out.

To prevent third parties from gaining access to your personal banking information, a new, unique bank account number will be issued for each transaction.

Compared to traditional payment methods like paper cheques or electronic funds transfers, this can significantly increase the safety of your financial information and keep your transactions private.

With virtual cards, account theft and e-commerce fraud are impossible because thieves can’t get into your bank just by getting your physical card.

So you have nothing to worry about if you lose your card and someone steals your important bank information.

2. Easy to Use

Unlike traditional banks, which have set hours, virtual banks are open all the time, 24 hours a day, 7 days a week. This way, they are always ready to help you with your international business whenever you need it.

Even better, you may do your business with the utmost efficiency with just a few clicks on your phone, laptop, or tablet, instead of wasting time driving to and waiting in line at a physical branch.

And you don’t have to wait ten working days to activate your account, or whatever the time frame is. Since computers control everything, don’t worry about paperwork or making mistakes by hand.

Accept the simplified accounts that take care of everything. The single-issued model frees up your accounts payable staff to concentrate on other crucial aspects of your business’s finances.

3. Affordable

Many financial institutions tend to charge their customers much less in fees.

If you pay your suppliers or buyers, you can get cash back for every rupee you spend.

On the other hand, you don’t have to pay anything for a virtual card. Since everything is done online, the virtual bank can lower its operating costs, which means it can charge its customers less. So you can do nothing and still make money.

4. Keep Track of Cash Flow Wherever, Whenever

Cash flow can get a little complicated when you’re trying to pay vendors or suppliers before a certain date.

But with a virtual credit card, you can track how much money you have because the system tells you so that you can make the payment process more open and efficient on the inside.

There are also extra features, such as giving virtual cards to specific people, such as vendors or suppliers, and keeping every source of transactions neat and clean. To ensure that your A/P department does not have to keep track of all invoices or chase down expenses from others, keep everything simple and clean.

5. Easy Card Management

Users of virtual credit cards have more flexibility and control than traditional cardholders.

Instead of the bank setting a fixed limit on how much you can spend, users can set their own limits or decide when to freeze or close their accounts. You can also give these single-use virtual cards to a specific person for a set amount of money. This gives you more control over how much you spend.

Conclusion

Virtual credit cards are an extra feature you can add to your existing credit card. They make your sensitive card information more secure. Indians can use their virtual credit cards anywhere that accepts online payments. You can read more blogs about virtual credit cards at Piramal Finance.