With identity theft a major concern across the world, disposable credit card numbers are a new way to protect against it. Almost everyone uses the internet. Almost everyone uses a credit or debit card. Everyone is worried about

identity theft.

Now, most credit card companies are offering disposable credit card numbers as a way to ease the worry.

The virtual credit card number, as it is properly called, is a one-time use only credit card number good for only one website. Also, it expires after, at most, two months of being issued.

Therefore, if someone obtains your online purchasing information during a transaction, he/she will not be able to use it, and they will also be cut off from any other personal identification information associated with making online purchases.

The disposable credit card numbers have been around since 2000, but new research aims to take the risk and inconvenience out of setting up and using them.

“It complicates the user experience and the result has been less-then-stellar adoption rates," Mike Rothman, head of Security Incite in Atlanta, told LiveScience.

CitiBank’s Virtual Account Number option, Bank of America's ShopSafe program and Discover's Secure Online Account Numbers are all established disposable credit card number programs, but to set up the accounts the consumers must enter their credit card numbers online.

Entering your credit card number online in order to avoid entering your credit card number online to make purchases is a conflict, one that researchers at Anglia Ruskin University in the U.K. are hoping to resolve.

They suggest obtaining the one-time use numbers through a combination of store information--probably sales price--and the actual credit card number. This new hybrid number would be issued by the credit card companies to the consumer. Consequently, neither the store nor a hacker could read or understand the number.

Though a viable aid in reducing identity theft online, disposable credit card numbers cannot be used for all transactions. Purchasing theater tickets, airplane tickets, or booking hotels requires the physical credit card when finalizing these transactions. With the disposable number likely expired by this time, it cannot be used.

In addition, with fraud protection and a card holder’s liability of only $50 for a lost or stolen card, some argue that it doesn’t make sense to add the virtual credit card number to the mix.

The purpose is to avoid the hassle, on both ends, of dealing with a stolen card number. By preventing the possibility of theft, the virtual credit card number eliminates the problem of contacting credit card companies, filling out paperwork, and going through the rigors of canceling a card and obtaining a new one.

It is for the merchants as well, as fraudulent purchases cost online stores millions of dollars in chargebacks each year.

Electronic payments accounted for more than two-thirds of the $93.3 billion non-cash transactions in the U.S. last year. Even so, more and more people are curtailing their internet purchases out of fear of identity theft, according to the Wall Street Journal.

Although it seems like a hassle, virtual credit card numbers are becoming easier and safer to use and in turn making your online shopping easier, safer and, like all good things, hassle-free.

By Danny Scuderi
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