In these cases, you may have to accept a store gift card instead of receiving the money back on your credit card. This obviously isn’t possible with a virtual credit card. The time it takes for a refund to show up on your credit card varies by vendor and card issuer. Some stores require you to insert or swipe the card you used for the purchase to process your refund back to your card. Returning items you order online to a physical location could be a challenge with virtual credit cards. In practice, many major credit card issuers do not hold you liable for any fraudulent purchases. Additionally, you aren’t liable for unauthorized use if just your credit card number, not the credit card itself, is stolen. If you do this before any unauthorized charges are made, your liability will be reduced to zero. To ensure you aren’t responsible for any unauthorized charges, you must properly notify your credit card company that your card has been lost or stole - before any unauthorized charges are made on the card. The Fair Credit Billing Act limits your liability for unauthorized use of a credit card to just $50. How much fraud am I liable for when using a credit card? Once you reach that limit, you won’t be able to make any more charges with that account number. Depending on your card issuer, you may be able to set up a virtual account number with the spending limit you have in mind. If you want to focus on limiting your spending with certain merchants, a virtual credit card can help with that, too. It also saves you the hassle of tracking down and updating your recurring payments with vendors other than the one affected by the breach. At the same time, closing the virtual card mitigates the risk of your main account being exposed in a data breach. Instead, the virtual credit card feature allows you to keep your main credit card account open. Unfortunately, this can cause issues with every vendor you’ve set up recurring payments with using your previous card number. That means you’ll get a new account number. If your main account number is exposed in a data breach because you didn’t use a virtual credit card, you’d have to get your main credit card account number reissued. The main benefit of virtual credit cards is the ability to close the account. Stay on top of your info with Credit Karma identity monitoring Then, you can create a new virtual account number to continue making purchases at that merchant.Īll of this gives you some ability to try to protect your main credit card account information in a world where data breaches are an unfortunate reality. This helps prevent fraudulent purchases without affecting your main credit card account. The issuer of a virtual credit card number may allow you to lock or delete a particular virtual account number. And you may also be able to specify a spending limit or a particular expiration date for a virtual credit card. You can limit a virtual credit card number for use at a single merchant. Virtual credit cards are unique credit card numbers that allow you to transact on your main credit card account without using - or exposing - your main credit card account number. Data breaches have become common stories in the news, so it’s worth considering how you may be able to use a virtual credit card to help reduce your risk of fraud.
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