Credit Card Security – Are One-Time Credit Card Numbers Next?
By Eva Norlyk Smith, Ph.D.
August 28, 2009
Identity theft is a growing trend worldwide. Millions of people each year have their personal data, bank account information, or credit card numbers stolen, and it sometimes takes months before the theft is discovered. Financial institutions put a great deal of time and resources into preventing identity theft in general and credit card fraud in particular.
If you’re concerned about credit card fraud, you may take heart in a promising new option to make online shopping safer: many credit card companies now offer one-time credit card numbers, which are generated anew each time you use your card.
Citibank, Bank of America, and Discover cards are pioneers in this new security feature, but expect it to become standard for all card issuers pretty soon. One-time credit card numbers are offered as an optional, free security service for cardholders who seek extra protection from credit card fraud when shopping online.
Once enrolled for the service, you will never again have to give out your real credit card number when you make purchases online. You simply log in to the virtual account number service to generate a random credit card number to be used for that purchase. You then enter the one-time credit card number at the merchant’s check-out page and complete the purchase as you normally would. The purchases made with the one-time account number will show up on your monthly statement like any other transaction.
Any hacker managing to steal away your credit card number during the online transaction or by hacking into the merchant’s database of credit card numbers will be severely disappointed. The virtual credit card number is a bogus number valid only for the transaction from which it was generated, or in some cases, only with the merchant for whom it was created.
One-time credit card numbers have different names. Citibank offers them via its Virtual Account Numbers service, Bank of America through its ShopSafe program, and Discover via its Secure Online Account Number service. The three programs offer essentially the same service, but they differ somewhat in how easy they are to use and how many bells and whistles they come with. Discover’s Secure Online Account Numbers service, for example, comes in both a web version for use on any computer, and in a download version for use on your personal computer. The latter has the advantage that it launches automatically over your browser window, so you don’t have to spend time signing in for your online banking service (as in the case of e.g. Bank of America’s ShopSafe) to use the service.
The three programs join Visa’s Verified by Visa and MasterCard’s SecureCode in offering innovative services to foil credit card thieves, and they are easier and more intuitive to use. While some of the services generating one-time credit card numbers could use a little upgrading in user friendliness, they still provide a great option for consumers looking to go the extra mile to protect sensitive financial information, such as credit card numbers.