Despite recent innovations in credit card security and the implementation of EMV embedded-chip credit cards in the United States, credit card fraud is still on the increase. It is particularly worse with card-not-present (CNP) fraud, like when a credit card is used to make a purchase online. Many companies are working to develop solutions that will reduce the amount of CNP fraud, including chip card readers that attach to your home computer, but some have gone even further by developing credit card products with disposable, one-time-use card numbers which would be useless to any data hackers or fraudsters.

Virtual account numbers, or VAN’s, are connected to your bank-issued credit or debit card and generated only as needed for shopping online. The disposable account numbers can be designated for one-time use or they can be given an expiration date – the consumer can set the dollar amount for which they can be used and even assign a specific period of time until they expire. One such use for VAN’s is fee-based monthly online subscriptions. A VAN can be generated only for the purpose of paying the fee each month, which is much more secure than having a debit or credit card number sit in a database for months. If the cancellation of such a service proves to be difficult for the customer, the VAN can be cancelled. It has no effect on her physical, static account number and/or card, which she can continue using as usual.

While Bank of America (BofA) and Citibank are offering VAN services to their customers, online companies that also generate VANs to individuals who do not have accounts with those two banks are beginning to pop up. One such company is Final, whose Visa-branded credit card product has features very similar to the BofA and Citibank services, including card numbers that only apply to a single transaction and a single merchant – once used, the number cannot be used again, essentially shutting down the possibility of fraud, as the numbers would be useless to fraudsters. Another service offering one-time-use protection is Privacy, a virtual debit card company working through Visa, which generates virtual card numbers to protect your security and privacy when shopping online. A Privacy virtual Visa debit card works just like a gift card and is locked in to a single merchant. Once again, like the BofA and Citibank VAN services, the consumer controls how the card gets used – as a single use card only good for one transaction (like a burner card), designate them for specific transaction usage and/or for budgeting by setting monthly spending limits.

As attractive as VAN services appear to be, they do have their detractors. Some experts claim that while they can offer a sense of security for those worried about hackers and fraudsters, they are not worth the hassle, especially in certain situations where they can be detrimental. For example, when making hotel reservations online, renting a car or similar situations where you need to present the physical credit card used for the transaction to complete it, some of the experts suggest using a virtual or one-time-use card number can become a stumbling block to completing the transaction, as there is no card with the VAN on it to present. Additionally, these experts believe returning items may be problematic, as most retailers will simply refund the purchase price the way you paid for it. If you don’t have the credit card it could be difficult, if not impossible, to get your money back and you may have to accept a gift card or store credit for your return. However, in this situation, any refund given would be credited back to the bank-issued card from which the VAN was generated.

However, there are many more people who believe the benefits of VAN’s far outweigh any issues that may pop up, and indeed many have said that they have never had any problems when using virtual/one-time use card numbers, even for hotel reservations and car rentals. One additional benefit to having a one-time use card number could be if virtual card is compromised, you don’t have to go through the hassle of waiting until a new card and account number is issued before you can begin using your account again. It is much better to use a virtual or one-time use account number and have that stored in an online database (which is why you don’t have to fill in your payment information every time you shop at some online retailers), than your regular credit or debit card account number, leaving it vulnerable to hackers or data breaches.

Virtual account numbers may not mean the end of data breaches and hacks, but they are a very useful tool in preventing credit card account fraud when shopping online, and the peace of mind they generate is worth the extra step it takes. The biggest downside is that they are not offered by many credit card issuers, but the hope is that more will get on board with this feature soon. If you frequently shop online, VANs are definitely worth a closer look.