However, sometimes even trying to find your card is an inconvenience. Virtual cards have slowly been making an appearance into the UK financial market, with more companies being regulated frequently. Digital banking is rapidly on the rise too, with less of us doing traditional in-branch banking than ever before. There is a lot of misinformation out there so we’ve compiled an article offering useful insights and advice, including the best virtual cards on the market right now. If you don’t even know where to start, we’ve also included lots of information about what virtual cards actually are, how to get one and the many benefits of using them.
What Is a Virtual Card?
A virtual card is exactly that, a card that doesn’t have a physical piece of plastic in your wallet or purse. In the UK, virtual cards are predominantly debit or prepaid cards, whereas the US operates more virtual credit cards. The idea is that it is operated on an app on your phone when out and about and you pay securely for purchases online using random security codes, sent by the app or sometimes via text. Security is a major issue for card users; with a virtual card, you are able to cancel any cards instantly if you suspect fraudulent behaviour and get a new card automatically. There is no need to wait up to five working days for a new plastic card to be delivered. Also, virtual cards offer extra security by not disclosing any financial data to any online store you buy from. This means that should the store’s servers be hacked or there’s an internal data leak, your card details will not be stored. However, if a physical store does not accept contactless payments, a virtual card will not work. For the most part, most high street stores accept contactless and many independent stores use mobile card machines, most of which do accept contactless payments.
What Are the Benefits of a Virtual Card?
Convenience
You may no longer need to carry a purse or wallet around. With a virtual card, all you need is your phone and the banking app. You can check your spending as little or as often as you like, with multiple tools available in-app to help you manage your money.
Budgeting
Many virtual cards offer budgeting tools integrated into the app so you may be able to set spending limits per day or per shop, helping you to save money. Virtual cards are great for recurring payments as they allow you to manage subscriptions by setting up a card for each one you have. You will be able to monitor how many you have, which ones you don’t use enough and if you’ve been overcharged at any point.
Security
Every time you purchase either from an online or physical store, your account details are completely invisible to the merchant. This means that should any data breaches happen to them, your data will not be accessible. Virtual cards offer that extra protection so you can shop safely online.
Speed
Not only do you not have to fumble around in a bag for your card, there is also the speed factor if you require a new card. This will happen instantly on the app without having to wait for a delivery, nor will your account be frozen so you’re unable to spend.
Options
Many of these cards offer single- and multi-use cards for frequent visits to the same shop or website. Some also offer currency conversion on your cards so you will no longer have to pay a fee when spending in another currency or with an overseas company. It is free to move money between Monese accounts, with a small fee to transfer funds to other bank accounts, both in the UK and internationally. Features:
Free payments and transfers within the UK Set up recurring payments Send money internationally for free (Premium plan) or a small fee (Simple and Classic plans) Budgeting tools – Set goals, record expenses, detailed transaction alerts, categorise payments Save money in up to 10 pots Cash deposits at any Post Office or PayPoint Security – Log in with Face ID, Touch ID or Fingerprint Scanner, one-time codes texted to you for every online purchase ATM withdrawals – £200 on the Simple plan, £900 on the Classic plan and unlimited on the Premium plan Foreign currency card spending – £2,000 free on Simple plan (2% fee over that), £9,000 free on Classic plan (2% fee over that), unlimited with no fee on Premium plan
It offers three levels of accounts:
Skriller – The basic account assigned to anyone who sets up an account True Skrillers – Fully verified customers, must have deposited via credit/debit card or bank account, have downloaded and logged into the mobile app VIP Skrillers – Additional features, premium rewards, lower fees, can have multi-currency accounts, a free physical card (this account also has silver, gold and platinum levels within it for even more offers/rewards)
Features:
Security – Make purchases and cancel your card at any time Control – You can decide how long you would like the card to be valid for Online-only usage, not valid offline or at ATMs Free transactions – Purchases, receiving money into your account, sending money to international banks using transfers Loyalty programme (Knect) – Earn points for transactions and trade them for cash rewards Buy and sell cryptocurrency
Again, there are three accounts to choose from with iCard:
Standard – Free account, comes with a physical card, free transfers to other iCard account holders, one virtual card allowed, fully online bank, pay with Apple Pay Infinite (€9.99 a month) – All of the above as well as free travel insurance abroad, 24/7 support via the app, Visa offers Metal (€13.99 a month) – All of the above as well as up to 1% cashback on transactions, unlimited ATM cash withdrawals, extra offers
Features:
Used in over 30 European countries Available in seven currencies – GBP, US Dollars, Euros, Swiss Franc, Romanian Lei, Bulgarian Lev and Croatian Kuna. You can have multiple virtual cards in one account but can order more physical cards in other currencies if need be. Digitise your loyalty cards so they’re all in one place Virtual cards can be used for any transaction – Services, subscriptions, one-off purchases Receive notifications of transactions and set spending limits Freeze and unfreeze your cards in the app Security – Fingerprint login Pay with Apple or Google Pay
This virtual prepaid card is designed to by-pass extra fees that UK banks charge for overseas transactions and allow customers to reduce their fees for delivery when buying from the US. US Unlocked works with reshipping partners as well as VPNs to allow you to receive US products and services in the UK. There are fees for initial opening (15)andloading(currently15) and loading (currently 15)andloading(currently3.50 plus 3.5%), 0.50pertransactionanda0.50 per transaction and a 0.50pertransactionanda3.50 monthly maintenance fee; however, this can still be cheaper than the exchange rates on UK-based bank charges. Features:
Apply with government-issued ID for verification online Set up a virtual card for each vendor or purchase, including subscriptions Set spending limits for businesses or categories Pause subscriptions from the app Given a US billing and shipping address Currently working on a browser extension for desktop
It is also worth remembering that none of these are covered by the Financial Services Compensation Scheme, meaning your money is not safe if the company goes under. However, for everyday, smaller purchases, virtual credit and debit cards are a great alternative if you prefer to do all of your banking via your phone. Most virtual banks offer budgeting tools to help you manage your money, including setting spending limits on certain brands or categories, managing any subscriptions and setting goals for both income and expenses. As some are prepaid, you can only spend the amount on the card, which is great for those who have problems with budgeting. Virtual debit cards will continue to rise within the financial market so it could be great to get on board first. WikiJob does not provide tax, investment or financial services and advice. The information provided is for general reference and you should not rely on it to make (or refrain from making) any financial decisions. Personal situations will vary. Always seek independent financial advice when choosing how to manage your finances.
