Yahoo Finance Digital bank releases disposable virtual debit cards
Digital challenger bank Revolut has launched virtual, disposable debit cards to combat scammers.
Once details of the single-use digital Revolut debit card are used to make an online payment, they are wiped and a new card is introduced each time they make a payment.
Details of ordinary credit and debit cards used online are often stored by retailers’ websites – and these can be vulnerable to hackers and fraudsters.
MORE: 8 steps you can take today to better protect yourself from identity theft
By erasing card details every time a customer shops online, Revolut believes it significantly reduces the chances of a user falling victim to scammers.
Vlad Yatsenko, co-founder and chief technology officer at Revolut, said: “Instead of matching what the larger institutions are doing, we are changing the game entirely by introducing disposable virtual cards.
“It will take approximately 800 years before we begin to run out of 16-digit card numbers, so we view disposable virtual cards as a sustainable, long-term solution to tackling online card fraud.”
Revolut is a smartphone-only bank founded in 2015. All customers who want to use a generated card number have to do is select the card option in the app and make a payment.
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The app will then destroy those details and generate a random new set which will be ready to use for their next purchase.
Online card fraud cost consumers £1.5billion in 2016 – a jump of 9% – with the UK and France making up 73% of all the fraud taking place.
The disposable virtual cards will work alongside Revolut’s existing customisable security features, including location-based security, and the ability to freeze and unfreeze physical cards, and disable functions such as contactless and swipe payments.
MORE: Money transfer scam costs victims almost £3,000 each
Last week, it was revealed that money transfer fraud cost victims £236 million last year – with each losing out almost £3,000.
Banking trade body UK Finance revealed that fraudulent use of payment cards, remote banking and cheques for 2017 cost in total £731.8 million, with card fraud down 8% to £566m as the industry continues to work hard to combat criminal activity.
