Virtual cards vs. digital wallets: Which should you use and when?

Virtual cards vs. digital wallets: Which should you use and when?
© Roman Samborskyi | Dreamstime.com

Your nephew’s birthday is coming up, so you go online and find a $300 Little Tikes playground set on sale for $60. But when the party rolls around, your money’s gone and that gift never showed up. So you head to the grocery store to buy some birthday treats instead … only to get caught by a card skimmer at checkout. Ouch.

I’m not making those up; I told you about that “Little Tokes” scam site and grocery store skimmers earlier this year.

Outsmarting crooks can be exhausting, but I have two simple tips to help you shop safer online and in person: Virtual cards and digital wallets.

A credit card with an ‘off’ switch

I’ve written about these recently and got a slew of questions. Let’s start here — If you still aren’t using a virtual card, you should be.

Virtual cards use a randomized 16-digit number, a three-digit CVV code and an expiration date you enter for online purchases. They connect to your real accounts, but retailers can’t see your actual card details.

That means an extra layer of protection against data breaches, hackers and fraudsters. Plus, you can easily turn off cards for subscriptions without canceling through the merchant (who wants you to keep paying).

As for when to use them, if it’s your first time shopping on a website or you’re signing up for an online subscription, virtual cards are your friend. Oh, and I recommend using one any time you buy something from social media.

💳 Some credit cards have virtual options with your account:

Pocket protectors

You might already have a mobile wallet set up on your phone, but I bet you don’t know how they actually work. Fun fact: When you make a purchase with Google or Apple Pay, they use a virtual card number, too. That means it’s safer than a physical card against skimmers.

Bonus: Apple doesn’t store your card info or bank password on its servers. It’s only stored on your device, and accessing it requires your PIN, fingerprint or facial recognition. Pretty nice!

Google encrypts your card info, but it does store your password and card on its servers. Bummer.

Tip within a tip: If you haven’t set up Apple Pay or Google Wallet on your device, come on and get with the program! You can find the step-by-step instructions on my site. You’re gonna love not pulling out your wallet to pay for things.

TL;DR: Use virtual cards for new online purchases, subscriptions and social media shopping. Use digital wallets for IRL buys.

😳 The last time I shopped in person, I asked to try on a dress in the window display. They told me I had to use the fitting room like everyone else. (Oh, that was bad!)

Tags: Apple, Google, Google Chrome, hackers