Handing out your credit card on the other hand may be a standard procedure in countries like the United States where the average consumer has more than 2 credit cards. The core problem with handing out your information is twofold. First, you need to trust the company or business that processes your credit card information on their web page. Considering that one of the largest banks did not get it right, it is fair to assume that there are no 100% safe places on the Internet to submit your credit card information to.

Some users might say that stolen credit card information may not be a big problem, as it is possible to cancel credit card payments for quite some time after the payments have been made. But that is only true if the credit card owner monitors payments regularly.

Most virtual credit cards offer better protection when shopping online. The core difference between virtual and real credit cards is that most virtual cards need to be charged before they can be used. They are prepaid cards. While it is still possible to get the credit card information stolen, an attacker has less options to squeeze out money from the account. A normal credit card could be charged for thousands of Dollars, a virtual card only for the amount that has been transferred to it by its owner. It is still recommended to check the credit card bills regularly, regardless of card and activity.

It is usually a lot easier to delete a virtual card and get a new one, in case someone managed to steal the information. Some banks and companies offer unlimited virtual credit cards to their customers, while others only one at a time.

Lets take a look at the benefits of virtual credit cards again:

• They work online just like real credit cards
• They are prepaid, and it is not possible to overdraw the account
• They are usually faster to setup and cancel

There are three downsides that we need to address. First, you get another credit card number that you have to monitor and take care of. Second, these virtual cards may come with fees that you have to pay. Some companies charge per transaction while others a yearly fee. This differs highly, and there is no rule of thumb. Some banks might even offer virtual credit cards without fees. And lastly the charging time. Depending on the bank or company, it may take time to charge the virtual credit card. At my local bank, it takes four business days to set up a prepaid credit card, and a day to charge it, which is not good if you need to make a payment urgently.

A year ago, I would have suggested PayPal for most users. But PayPal has dropped their virtual credit card offering. Your best option now is to contact your bank to see if they are offering virtual cards. If you are lucky they do and charge you little or nothing at all for it.

You find several independent companies on the Internet that offer virtual prepaid cards. Companies like Entropay charge a hefty fee for transactions on the other hand. They currently charge 4.95% for transferring money to the card.

Is there another way to get a virtual credit card online? Let us know in the comments. I for one have made the decision to get a prepaid card from my local bank, despite the negative aspects.