Introduction to virtual credit card

A virtual credit card is a credit card that every-time when one wants to make an online purchase on enters the actual credit card information and a new number is generated to facilitate the online purchase. This virtual credit card number generated will be temporary and expires immediately the online purchase is successful.

 Advantages of virtual credit card.

• One of the advantages of the virtual credit card is that the number generated is only valid for the one time online purchase and transaction. Once the online transaction and purchase are successful the it expires.
• Another advantage of virtual credit card is that one can set a limit for the particular online purchase and transaction they want to make. This advantage of the virtual credit card ensures that the merchant does not charge more for the online purchase and transaction. Therefore virtual credit cards help the one take control of their finances by ensuring that they stay within their financial budget.
• Virtual credit card has another advantage in that they are widely recognized and can be used by anyone online to make any online transactions and online purchases. Most merchants accept the virtual credit card giving the online shopper freedom. Therefore virtual credit card allows for online purchase from all over the world.
• Data safety and security is another advantage of virtual credit card in that the actual account number of the credit card is not visible to the merchant or on the online payment system. Therefore this information cannot be used by fraudster to make any other fraudulent online purchases and transactions. This makes online transactions and online purchases using the virtual credit card safe and a great advantage.
• Another advantage of the virtual credit card is that it gives the online purchaser freedom as they are not worries that their actual credit card information would be used fraudulently.
• Another advantage of using virtual credit card is that there is flexibility in the use of this virtual credit card as it can only be used when there is a need to make online purchases. Since the number generated for the virtual credit card is temporary then the online purchaser uses it only when they are ready to make any online purchases.

 Disadvantages of virtual credit card.

•  One of the disadvantages of the virtual credit card is that the transfer of funds from the online purchasers account to the merchant account takes time and at times the goods are delivered before the actual payment to the merchant is made.

• Another disadvantage of the virtual credit card is that even though the virtual credit card is widely accepted, some merchants are still skeptical and have not fully accepted the virtual credit card.

What is a Virtual Credit Card

Over the years this has been hampered by hackers who have used the system to fraud the online purchasers using the information they have obtained from the credit cards hence the introduction of the virtual credit card. A virtual credit card is a card which is a replica of the actual credit card and which a user can generate it online. This virtual credit card generated will only be used to make online purchase and not any other purchases. Like any other credit card the person must apply for this virtual credit card. All credit and lending elements will be taken into consideration by the company offering the virtual credit card.

The main characteristics of the virtual credit card which differentiate it from the physical credit card are as follows:

1. Virtual credit cards are only used for online purchases; one cannot make any other purchases using this card.
2. Virtual credit card may be a temporary card which can only be used to make this online purchase once and will not be used again as it will have expired once the transaction is successful.
3. Every-time one wants to make online purchases, then they have to enter the actual credit card information and a new number is generated for the virtual credit card which can then be used.
4. The virtual credit card does not reveal the actual account number and the account details of the actual credit card. These details are only visible to the account holder and the actual credit card provider.
5. The virtual credit card number which is generated and which can be seen is temporary and also useless and cannot be used to access the actual credit card account.
6. The virtual credit card since it generates a temporary number for a particular online purchase therefore there is no information and details of the actual credit card account. This ensures that the actual credit card is not used for fraud.

 Conclusion on virtual credit card

Since the world has become a global village, the introduction of the virtual credit card has brought a great revolution to online purchases. Curbing of fraud which had really been on the increase has also been enhanced by ensuring good data security systems while also giving the freedom to purchase online. Virtual credit card has revolutionised the concept of cards and their usage in this age.

What are Prepaid cards in Kenya

Prepaid Cards in Kenya

Prepaid card is a debit card that is loaded with funds before the funds are required. The money is not debited from your bank account but from the funds that are held in the card account that has been made available by you.

After the financial crisis in the world, in 2008 and years following, the prepaid cards are being used more as a way to manage personal finances. Many previous credit card holders had their credit scores and ratings affected when they were unable or missed to pay for their credit cards or loans. Though these former credit card holders have repaid their loans, their scores are still low. The prepaid cards are able to assist many people who cannot meet the required scores to get other cards and are able to access the convenience of plastic money.

Prepaid cards in kenya as a personal financial management tool

Many people have a problem trying to live within their means. Prepaid cards in Kenya are being used as a way for managing financial challenges. The prepaid card holder loads the card with the amount they require for the month and this is all the money they will use. The card is reloaded monthly and so the cardholder cannot spend what they have not preloaded or planned to use.

The card issued determines the minimum and maximum amounts that cardholders can load to their prepaid cards at any one time. The cardholder determines what they will require for the month an they load this amount. The prepaid card will allow the holder to access the same outlets that they would if they had a credit card or a debit card.

The prepaid cards are used more and more by many people throughout the world. Cardholders can plan for an activity and save for the expense that is required. When the savings are reached, the cardholder can purchase a prepaid card for the amount saved. This is especially good for holidays and leisure activities that can be planned for without using monies put aside for other necessary expenses.

Though prepaid cards have been in use in the western world, they are still new in the Kenyan market. The cards will assist Kenyans plan their expenses better and manage their finances especially in this hard economic times. Prepaid cards in Kenya should be a card that all Kenyan should use to manage their finances.

prepaid cards in Kenya

What are prepaid cards in Kenya

They are a type of debit cards. They differ from the usual debit cards in that they are prepaid while a debit card uses the money in your bank account. They are sold or given out mainly by banks and also by some individual stores or shops, especially in the western world. The cards are called prepaid because the amount to be used is predetermined by the cardholder and paid for in advance. This is convenient to the bank because it is able to collect and mobilize funds before it has to pay for the cardholders spend. Prepaid cards may be used as gift cards, salary cards, store cards and travel cards, to name but a few.

Features of prepaid cards in Kenya

A unique feature on some prepaid cards in Kenya is that they do not necessarily have to have a name printed on the cards. As the banking industry in Kenya evolves and the card business moves to a higher level, cards may be sold to customers from supermarkets and through Agency banking agents. They will be sold like the mobile phone top-up cards. They will be availed to all who need them especially as gift options. The prepaid cards in Kenya can be used in stores that accept the credit and debit cards across the globe.

The prepaid cards may be magnetic strip meaning they have to be swiped at a Point of sale machine. The alternative is to have the prepaid cards as chip cards, which means the information is held in a chip. Chip cards may be used on merchants that are not yet Chip because the default for these cards is the magnetic strip.

Prepaid cards may be denominated in local currency or in foreign currency depending on the financial institution that is issuing the cards.  The cards may be for local use only or they may be used internationally. The prepaid cards are usually re-loadable. Whenever more money is required on the card, the cardholder deposits more money in his card account.

Banks giving prepaid cards in Kenya

Not many banks in Kenya have started on this business line yet. There are three banks who currently give this service. The banks are Kenya commercial bank, Investment and mortgages bank and Bank of Africa.

As the prepaid cards continue to grow in popularity in most parts of the world, the banking sector in Kenya has to be involved. We should prepare ourselves for the competition that will be witnessed in the financial institutions as they get into the prepaid cards in Kenya.