Virtual credit cards

Sunday 7 April 2002

If you have ever been the victim of credit card fraud (as I recently was), or if you are simply concerned about the possibility, you should look into Citibank’s virtual account numbers stuff.

It’s a simple idea: create new credit card numbers for each online transaction. Each number is limited to one merchant. If anyone else tries to charge against the number, the charge is declined. Also, you can set time limits and charge limits. So for example, if I want to buy a $30 book from a small retailer, I can generate a new virtual account number good for up to $40, with an expiration date three months from now. Even if the account number gets posted to a bulletin board, it won’t do anyone any good (and using it will probably trigger fraud alarms).

Not only is the idea a good one, but I like the implementation, too. Citibank provides a Windows application that sits in the system tray, and has a slick UI. When generating the new account number, it uses a satisfying rolling numbers effect. It’s precisely the kind of thing that you’d see in a movie, and you’d think, “Oh, real software doesn’t look like that!” Also, once the number is generated, you can drag-and-drop it onto the edit controls in the web browser, and the whole number is in the drag cursor, providing great feedback about what is going on. Excellent!

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