Also called: Single-Use Card, Virtual Account Number, Virtual Commercial Card
What a virtual card is
A virtual card is a digital payment credential, not a physical card. It has a card number, expiration date and security code, and it is linked to an underlying funding account. A financial institution issues it through a website or app. Businesses use virtual cards to pay suppliers, cover employee expenses and make purchases tied to a specific invoice.
A single-use virtual card can be set for one purchase, supplier, amount or time period. The buyer controls can also limit where and when the card works, including by merchant category. There is no universal expiration period or spending limit. The buyer's settings determine those controls.
A virtual card is still a card payment, so treat it as a card-not-present sale with ordinary processing costs and dispute risk.
How virtual card payments work
The buyer sends your business the card details and payment information, such as an invoice or purchase-order number. Your accounts-receivable team enters the card details and authorized amount into your payment gateway, then captures the payment. Automated processing can handle the card and remittance information without manual entry.
Many business payments are set to the exact invoice total. If the invoice changes, the buyer may need to issue an updated card or approve a different amount. The payment travels through your existing merchant account as a card-not-present transaction. The cited processing guidance puts settlement at 1 to 3 business days after capture.
What virtual cards mean for your costs
Accepting a virtual card is still accepting a card payment. Merchant discount rates apply, and the transaction is processed as card-not-present. The available sources do not establish a universal virtual-card fee or a standard fee amount, so do not assume the word “virtual” means lower processing costs.
The buyer's controls can reduce the risk of unauthorized use, but they do not remove your normal card-payment exposure. Keep proof of delivery, signed purchase orders and clear payment terms to support your response if a buyer disputes a charge. Do not store the full card number or security code after processing.
Where the work can add up
The hidden cost for your business is often staff time, not a special fee line. When card details arrive by email or phone, your team must match the payment to the right invoice and record its remittance details. A mismatch between the card's authorized amount and the invoice can delay reconciliation or require a corrected payment.
Before accepting virtual cards from a customer, agree on how to handle invoice changes, partial payments, refunds and expired cards. Decide whether your team will request a replacement card or use a partial capture and credit process. Those steps reduce avoidable delays when the payment is tied to one invoice and one authorized amount.
What you can actually change
- Match payments carefully. Record the invoice and purchase-order details with each card payment. Confirm the captured amount matches the authorized amount before posting it.
- Set refund rules. Agree with the buyer on how to handle partial payments, invoice changes and cards that have expired before a refund is issued.
- Track card costs. Compare virtual-card transactions with your other card-not-present sales on your processing statement. Review the fees and any staff time spent fixing payment mismatches.
Frequently asked questions
Does accepting a virtual card cost more?
A virtual card is processed as a card-not-present payment, and merchant discount rates apply. The available sources do not establish a universal extra fee or standard rate for virtual cards. Compare the transaction's processing costs with your other card-not-present sales.
How long does a virtual card payment take to settle?
The cited processing guidance describes payment arriving 1 to 3 business days after the transaction is captured. Timing depends on the payment process and capture point, so distinguish authorization from capture when tracking an invoice.
Are virtual card payments safer for my business?
Single-use numbers and buyer-set controls can limit where, when and how much can be charged. They do not remove card-not-present dispute risk. Keep proof of delivery and purchase orders, and do not retain the full card number or security code.
What should I do if the virtual card amount does not match the invoice?
Pause posting the payment until you confirm the approved amount with the buyer. The card may be limited to the original invoice total. Agree in advance whether the buyer will issue a replacement card or approve a partial capture and credit.