When you shop online, you usually have to give credit card information to complete the purchase.  Most companies do a great job with securing their websites and their check-out pages because they know if they don’t, people are less likely to come back and shop with them. 

TIP: Look at the URL, the address line, on the web page.  It should have https://, not just http:// to indicate a secure site.  You can also check on the page for the little padlock symbol or for the icons of well known security programs such as Verisign.

One thing consumers can do to protect themselves is to use a Virtual Credit Card, also known as substitute credit card numbers or controlled payment numbers.   Companies that offer this to their customers include Discover, Citi, Bank of America, and PayPal; this is typically a free service to these customers.

HOW IT WORKS
The Virtual Credit Card creates a one-time use number that is linked back to your actual credit card account.   However, the only thing a merchant ever sees is the temporary number.  It will be processed just like a regular credit card payment and is only good for that one-time use.  The purchase will be on your next monthly credit card statement.  You get peace of mind knowing that your actual credit card number was not exposed at all during your online shopping.

WHY USE A VIRTUAL CARD?

Even though the merchant has a secure website and your account information is safe while shopping with them, there are other companies that may be involved in the transaction after the initial purchase.  This includes the credit card processing company and there have been data breaches in the past few years involving some of these processing companies.

Another reason to use a Virtual Credit Card is to prevent recurring charges.  Sometimes you go to a site and sign up for a ‘trial period’ with the company’s product or service.  By using a virtual, one-time-use number, you can prevent the company from continuing to bill you after you cancel during the trial period.

NOTE: Virtual Credit Card numbers will not work  with purchases that require you to show the actual card for verification.  This includes rental cars, airline and hotel reservations, and some tickets that are purchased online.

For more information on Identity Theft Prevention, click here.

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