Imagine applying for a credit card, getting approved and being able to use it right away. You don’t have to imagine if you get an instant virtual credit card. One of the many advantages of these cards is that you can use them right away instead of waiting for a physical card to arrive in the mail, and the benefits don’t end there. Keep reading to learn more about how they work and an attractive option that could be a good choice for you.
What is an Instant Virtual Credit Card?
An instant virtual credit card is a digital credit card you’ll get access to before your credit card arrives in the mail. It allows you to make online purchases and shop with retailers that accept contactless payments.
You can use this card even after receiving your physical credit card. Some consumers opt for this approach since they can access virtual cards on a mobile device. It’s easier and more convenient for some people to access an instant-use credit card on their phone instead of having a physical card at all times.
How Does an Instant Virtual Credit Card Work?
Virtual credit cards operate like traditional credit cards. Upon approval, you’ll receive a digital card with a unique card number, expiration date, and CVV code that you can use right away. Input this information when checking out online, or select the contactless payment method if you’re making a purchase at a physical location.
Once you receive your card in the mail, you can opt to disable your instant virtual credit card or continue using it to make purchases. You can continue the virtual experience with Apple Pay or Google Pay. These digital wallets let you store credit card information for easy access during purchases.
Understanding the Concept of Instant Approval Virtual Credit Cards
Instant virtual cards are attracting more consumers and business owners due to their high level of security and instant use. You can generate a new card number within seconds and use it to place an order. Having a unique instant card number for every purchase keeps your main virtual card number safe.
A common weakness with the traditional format is that a data breach can expose your credit card number. You can make orders with greater peace of mind, knowing that a data breach no longer exposes your credit card number. You can limit purchases or turn off an instant credit card number in real-time for additional protection.
Is It Safe and Secure to Use an Instant Approval Virtual Credit Card?
These personal and business cards are safe and secure. They have the same protections as traditional credit cards but have the added protection of a unique credit card number for every purchase. Reviewing card details can give you a better idea of how an instant-use card issuer is keeping your information safe.
What are the Requirements Needed to Apply for One?
You must fulfill an issuer’s eligibility requirements to obtain an instant approval virtual card. You will have to pinpoint an online application and assess the minimum credit score requirement. Business credit cards may also have additional requirements, such as a minimum amount of revenue.
You will have to provide your personal information when applying for any credit card. Issuers will ask for your photo ID, home address, and other details. It’s also a good idea to check the requirements for each card’s welcome bonus. That way, you can calculate how many eligible purchases you have to make within a small window to receive extra cash or points as a part of the welcome offer.
What are the Advantages of Instant Virtual Credit Cards?
Instant virtual credit cards come with several benefits that make them worth considering.
Easy to Use
The card information will be available directly on your financial institution’s mobile app. In addition, you can use it online or at any retailer where contactless payment is accepted. More retailers are using contactless payment technology because more consumers are using virtual credit cards for their purchases. This technology can also save time during checkout as people can put their phones next to a scanner instead of taking out their credit cards.
Fast or Temporary Solution
Financial emergencies call for expedited solutions, which you’ll get with an instant virtual credit card. You won’t have to wait several business days for a physical credit card to arrive by mail.
A virtual credit card can alleviate the pressure of having to access the funds you need. This card helps out even more if you get started with a high credit limit. It can take multiple days for a physical card to arrive, but it can also take that amount of time to get approved for a loan. Instant approval credit cards allow you to access funds immediately after getting approved.
Access Your Funds Instantly
You won’t have to wait for the standard seven to ten business days for your card to arrive in the mail. Instead, you can access funds immediately and start purchasing the goods or services you need most. Some credit card issuers offer instant approval. Other issuers may have you wait a bit before letting you know if your application for a new credit card got approved.
Using your credit card right away can give you a head start with any welcome offers. You can make the necessary amount of purchases within the card issuer’s timeframe to potentially receive bonuses that can be worth hundreds of dollars.
Manage Your Card From Anywhere
Review account activity, make payments or request support directly from the mobile app. Many banks also allow you to view this information from your desktop. You can also set spending limits on some virtual credit cards to avoid accruing a ton of interest charges or spending more than you can comfortably afford to repay. You can freeze and unfreeze your credit card with a few clicks to prevent unauthorized access. This feature becomes more important if you recently noticed any suspicious activity on your credit report.
Get Rewards for Every Dollar You Spend
Most credit card issuers have rewards programs that encourage consumers to do business with them. You can earn points or cash back depending on the type of credit card you use. Of course, you shouldn’t spend for the sake of accumulating rewards, but getting something back with every purchase you would have made anyway is a great deal.
Some credit cards have additional perks for specific spending categories. Apple Card users can buy qualifying products at an Apple Store and make monthly payments at 0% APR. You can also get 3% daily cash back for purchases at an Apple Store.
You can compare numerous credit cards based on their rewards programs, such as the Chase Freedom Flex and American Express Blue Cash Preferred card. Many credit card issuers offer immediate access to virtual cards, but a rewards program can indicate if a card is worth it for the long haul.
Some people accumulate credit cards because of their different reward structures. A card from American Express may reward different spending categories more favorably than a credit card issued by Mastercard. These cards won’t provide 3% cash back for purchases at the Apple Store, but you can get more favorable rewards elsewhere. Just make sure you don’t apply for too many credit cards, as excessive hard credit inquiries can lower your score.
Build Credit with Every On-Time Payment
A virtual credit card, just like a physical card, lets you build credit with every on-time payment. Your financial activity gets reported to the major credit bureaus, and that activity can help you qualify for a mortgage or auto loan with favorable rates and terms.
On-time payments represent 35% of your credit score. While credit card payments build your score, the same cannot be said about debit cards. On-time payments will also improve your overall finances and result in a better credit utilization ratio. This ratio makes up 30% of your credit score.
Introductory APR Programs
Some virtual credit cards have enticing APR programs. You can get 0% APR for the first 12-18 months of opening your card. It’s less risky to accumulate debt on these cards since you won’t owe interest right away. However, letting the debt linger too long can hurt your credit score and put you in a bad position when the introductory APR expires.
Some credit card issuers let you initiate balance transfers, but this usually results in a fee equal to a percentage of the credit card’s balance. A small number of issuers do not have balance transfer fees. Getting into the habit of balance transfers can result in significant debt accumulation and damaged credit due to numerous hard credit inquiries. Introductory APR programs are useful perks, but you should not rely on them to keep your finances in order.
How to Open a Virtual Credit Card
A virtual credit card arrives right away and has great security features. These cards even make sense for people who already have a physical copy of their credit cards. The process for opening a virtual credit card is straightforward.
Compare Different Credit Cards
Most credit card issuers offer virtual credit cards, but some have better terms, fee structures, and rewards programs than others. You should also check credit score requirements and other details. Consumers with bad credit may have to start with secured credit cards. You may also want to narrow your search to credit card issuers that do not conduct hard credit checks. These cards may be easier to obtain for people who do not have the best credit. Browse around to see which credit card is the right one for you.
Submit an Application
After finding the right credit card, submit your details on the issuer’s website. Some credit card companies promise same-day virtual credit cards, which you can access from your computer, smartphone, or any other device if your application gets approved.
Receive Approval and Put it in Your Digital Wallet
Once you receive approval and accept your virtual credit card, you can start using it in your digital wallet. Put the credit card information in Apple Pay or Google Pay, so it is readily available when you make online and in-store purchases.
Should You Get a Virtual Debit Card Instead?
A virtual credit card provides instant access to additional funds, but is a debit card the better choice? The process for getting a virtual debit card is similar to getting a virtual credit card, but which one should you choose? We have highlighted key details about each card for you to consider.
Spending Power
Debit cards are limited to the funds in your checking account, but a credit card’s limit can significantly exceed your checking account. Some people need funds for an emergency but don’t want to worry about reducing their checking accounts. Credit cards with introductory 0% APR programs reduce the blowback from getting into credit card debt early on. A virtual credit card gives you more financial flexibility in the short term.
Debt
Virtual debit cards do not put you into debt. You can only pay with your checking balance, and you will get an overdraft fee if you try to overspend. Some financial institutions offer overdraft protection and other features to minimize these fees, but you cannot rack up debt with a virtual debit card. A virtual credit card, on the other hand, can put you deep into debt, and double-digit interest rates don’t make it easier to pay off.
Rewards Programs
Debit cards have been catching up, and more of them offer cash back. Although cashback debit cards are becoming more popular, credit cards offer a greater range of rewards programs and perks.
Fees
Debit cards have a straightforward fee structure. If you do not overdraw your bank account, you won’t have to worry. Credit cards have more fees that can make it more difficult to get out of debt. Credit cardholders will have to contend with high interest rates, late payment fees, additional costs for exceeding the credit limit, and other expenses. Credit card companies can also sneak in annual fees and other expenses under the table. This practice isn’t as rampant as it once was, but you have to be more careful about hidden credit card fees than debit card fees.
Credit Building
A virtual credit card’s strongest strength over its counterpart is credit building. Credit card activity gets reported to the major credit bureaus, but the same isn’t the case for virtual debit cards. This can become problematic for credit cardholders if they fall behind on payments.
FAQs About Instant Approval Virtual Credit Card
Most issuers do not have limits on how many numbers you can generate. You will still have to abide by the credit limit of your main card.
You can typically receive your virtual credit card number and access your card within minutes after approval. Some banks like Capital One and Wells Fargo mail your physical card and let you use your virtual card while you wait. Other banks forgo physical credit cards entirely and only give out virtual credit cards.
