What Is a Virtual Credit Card?
A virtual credit card is a credit card to which the cardholder has instant access immediately after receiving approval from the credit card issuer. Such a credit card has all the same details and features as a traditional card in physical form, but to get a virtual card, the borrower does not need to wait for the card to be delivered to their home.
The cardholder can add a virtual card to any digital wallet, such as Samsung pay, Google Pay, or Apple Pay, and pay in stores. Many such cards can also be obtained in physical form if the borrower makes such a request.
Pros and Cons of Virtual Credit Cards
Pros
- Increased protection against fraud and theft. A virtual credit card allows the borrower not to have a standard card in physical form. A thief will not be able to steal such a card from the borrower's wallet. Moreover, if a hacking attempt is made, the cardholder can block it with one button, change the credit card number or even reissue a new card in a few clicks.
- The ability to customize a credit card. The cardholder can not only choose its external design but also change the PIN code or card number in the mobile application in a few clicks. Changing the PIN code allows the borrower to stop the withdrawal of money from their card by a thief. Changing the card number helps in paying with a card in services that have automatic withdrawal of money for a subscription.
- Profitable rewards, bonuses, and perks. Many instant approval virtual credit cards offer cash rewards, sign-up bonuses, and various perks to holders for using the card. Usually, such cards have from 1% to 2% cash back on purchases in all categories and can have up to 6% cash back on purchases in eligible categories. Such categories can be gas stations, grocery stores, entertainment purchases, restaurant purchases, and others.
Cons
- Payment without a physical card is not always available. Not all brick-and-mortar stores have payment terminals that accept payments from digital wallets. The borrower needs to take this fact into account when receiving such a credit card.
- Hotel booking and car rent issues. If the cardholder uses a change of card number, some of their reservations may be canceled because for booking a hotel or car for rent in advance, the card is checked for funds. Some hotels and car rentals do not accept virtual credit cards themselves, just because some holders of such cards change card numbers in order not to pay for the reservation made.
Types of Virtual Credit Cards
- A business credit card is used by business owners to finance businesses of any size. Such credit cards can help a business owner monitor business-related expenses separately from personal expenses and keep financial records more accurately. Moreover, such cards often have perks useful for businesses and can help in building a credit profile for future loans.
- Co-branded cards. Such credit cards are issued jointly by two parties. The first party is a bank or other financial institution that ensures the card's operability from the point of view of the banking system. The second party is a company or brand that adds perks or bonuses associated with this brand to the credit card. Most often, retail stores such as Amazon act as the second party. From here, these cards have discounts and promotional offers for online retail purchases.
- Cash-back credit cards offer holders of such cards the ability to receive cash rewards with each purchase. The percentage of cash-back is small, but the main advantage of such cards is that rewards are returned in the form of real dollars and not any points. Usually, such cards have from 1% to 2% cash back on purchases in all categories. The most profitable cash-back credit cards may offer increased cash back on eligible purchases in some bonus categories. Moreover, categories with increased cash-back may change every 3 months.
- Travel credit cards are created specifically for travelers. All sign-up bonuses, rewards, and perks in such cards are applicable only for spending in the travel category. Often, such credit cards offer cardholders to receive rewards in the form of miles that they can use to purchase discounted airline tickets. Credit cards for travelers may have a reduced foreign transaction fee. As perks, travel credit card companies offer discounts on paying for hotels, paying for rental cars, or additional free luggage.
- Secured credit cards, as well as unsecured credit cards, have a credit line. However, the maximum amount that the cardholder can withdraw from the credit line depends on the security deposit that the borrower deposits. Without making a deposit, the borrower will not be able to use a secured credit card. This card is great for borrowers with bad credit but a stable source of income. If the borrower has a low credit score, then most likely, they will be refused if they apply to open an unsecured credit card.
- Rewards credit cards have a rewards program that awards the cardholder a reward in the form of points. The cardholder can later use these points to receive discount offers in certain spending categories. Rewards cards are different depending on the category of spending in which they offer rewards. For example, some of these cards may offer rewards in the restaurant's category, while others encourage everyday spending habits.
Best Instant Approval Credit Cards
Blue Cash Preferred Card from American Express
The Blue Cash Preferred Card from American Express is a good option for those who want to earn generous cash back rewards on their everyday spending, especially on U.S. supermarket purchases and select U.S. streaming services. The card's sign-up bonus, purchasing power, and benefits can provide additional value to cardholders. However, the card does have an annual fee, so it is important to consider this when deciding if the card is the right fit.
The Blue Cash Preferred Card from American Express is a cash-back rewards credit card that offers the following benefits:
- Rewards. Cardholders earn 6% cash back on select U.S. streaming services, 6% cash back on select U.S. supermarket purchases, 3% cash back on transit, including taxis, parking, tolls, trains, buses, and more, and 1% cash back on all other purchases.
- Sign-up bonus. New cardholders can earn a sign-up bonus of $300 statement credit after spending $3,000 on purchases in the first six months of account opening.
- Purchasing power. The card is accepted at many locations worldwide and offers benefits such as extended warranty protection, purchase protection, and more.
Rates and fees for the Blue Cash Preferred Card from American Express include:
- Annual fee. The card has an annual fee of $95.
- Interest rate. The card has a variable purchase APR of 14.49% to 25.49%.
- Balance transfer fee. The balance transfer fee is $5 or 3% of the amount transferred, whichever is greater.
Blue Cash Everyday Card from American Express
The Blue Cash Everyday Card from American Express is a good option for those who want to earn cash back rewards on their everyday spending, especially at U.S. supermarkets and select U.S. department stores. The card's sign-up bonus, purchasing power, and lack of an annual fee make it a cost-effective option for those who want to earn rewards for their spending.
The Blue Cash Everyday Card from American Express is a cash-back rewards credit card that offers the following benefits:
- Rewards. Cardholders earn 3% cash back at U.S. supermarkets, 2% cash back at U.S. gas stations and select U.S. department stores, and 1% cash back on all other purchases.
- Sign-up bonus. New cardholders can earn a sign-up bonus of $150 statement credit after spending $1,000 on purchases in the first three months of account opening.
- Purchasing power. The card is accepted worldwide and offers benefits such as extended warranty protection, purchase protection, and more.
Rates and fees for the Blue Cash Everyday Card from AmEx include:
- Annual fee. The card has no annual fee.
- Interest rate. The card has a variable purchase APR of 14.49% to 25.49%.
- Balance transfer fee. The balance transfer fee is $5 or 3% of the amount transferred, whichever is greater.
Costco Anywhere Visa Card by Citi
The Costco Anywhere Visa Card by Citi is a good option for those who are Costco members and regularly shop at Costco and purchase gas. The card's cash back rewards and benefits provide value for those who want to earn rewards for their spending.
The Costco Anywhere Visa Card by Citi is a cash-back rewards credit card that offers the following benefits:
- Rewards. Cardholders earn 4% cash back on eligible gas purchases (up to $7,000 per year, then 1%), 3% cash back on restaurant and travel purchases, 2% cash back on all other purchases made at Costco and Costco, and 1% cash back on all other purchases.
- Purchasing power. The card is accepted worldwide and offers benefits such as extended warranty protection, price protection, and more.
Rates and fees for the Costco Anywhere Visa Card by Citi include:
- Annual fee. The card is available exclusively to Costco members and requires a Costco membership.
- Interest rate. The card has a variable purchase APR of 16.49%
- Balance transfer fee. The balance transfer fee is either $5 or 3% of each transfer's amount, whichever is greater.
Capital One Walmart Rewards Card
The Capital One Walmart Rewards Card is a good option for those who are frequent shoppers at Walmart and Walmart. The card's rewards and special financing offers make it a cost-effective option for earning rewards for their spending. However, it is important to consider the card's high purchase APR and balance transfer fee when deciding if it is the right fit for you.
The Capital One Walmart Rewards Card is a cash-back rewards credit card that offers the following benefits:
- Rewards. Cardholders earn 5% cash back on purchases made at Walmart, 2% cash back on in-store purchases made at Walmart and at Murphy USA and Walmart fuel stations, and 1% cash back on all other purchases.
- Sign-up bonus. New cardholders can earn a sign-up bonus of $25 after spending $25 on purchases within 3 months of account opening.
- Special financing. The card offers special financing on purchases over $150 at Walmart.
Rates and fees for the Capital One Walmart Rewards Card include:
- Annual fee. The card has no annual fee.
- Interest rate. The card has a variable purchase APR of 24.99%.
- Balance transfer fee. The balance transfer fee is 3% of the amount transferred, with a minimum fee of $10.
American Express Green Card
The American Express Green Card is a good option for those who value the ability to earn rewards and travel benefits and have access to exclusive experiences. However, it is important to consider the card's annual fee and balance transfer fee when deciding if it is the right fit for you.
The American Express Green Card is a travel and lifestyle credit card that offers the following benefits:
- Rewards. Cardholders can earn Membership Rewards points for every dollar spent on eligible purchases, which can be redeemed for travel, merchandise, and more.
- Travel benefits. The card offers travel benefits such as no foreign transaction fees, travel accident insurance, and 24/7 global assistance.
- Access to experiences. Cardholders have access to exclusive experiences, such as early access to ticket sales, access to the American Express global lounge collection, and more.
Rates and fees for the American Express Green Card include:
- Annual fee. The card has an annual fee of $150.
- Interest rate. The card has a variable purchase APR of 14.24% - 22.24%
- Balance transfer fee. The balance transfer fee is either $5 or 3% of each transfer's amount, whichever is greater.
Macy's American Express Card
The Macy's American Express Card is a good option for those who are frequent shoppers at Macy's and want to earn rewards for their spending. The card's exclusive offers and discounts and flexible payment options are added benefits. However, it is important to consider the card's high purchase APR and balance transfer fee when deciding if it is the right fit for you.
The Macy's American Express Card is a store-branded credit card that offers the following benefits:
- Rewards. Cardholders earn rewards on purchases made at Macy's and other eligible purchases.
- Exclusive offers and discounts. Cardholders have access to exclusive offers and discounts, such as early access to sales and special events, as well as discounts on eligible purchases made at Macy's.
- Easy payment options. The card offers flexible payment options, such as online bill payment and automatic billing, which make it easier for cardholders to manage their account.
Rates and fees for the Macy's American Express Card include:
- Annual fee. The card has no annual fee.
- Interest rate. The card has a variable purchase APR of 25.24%.
- Balance transfer fee. The balance transfer fee is $5 or 3% of each transfer's amount, whichever is greater.
How to Get Instant Approval on a Virtual Credit Card?
To get an instant approval for a credit card, a potential borrower must meet certain requirements.
The borrower must have a stable source of income. The borrower's debt-to-income ratio should not be higher than 45%. Employment or self-employment is best suited for opening a credit card, but dividends and income from alimony may also be suitable. To confirm the borrower's income, the credit card company may ask you to download pay stubs, W-2s, tax returns, or bank statements.
To be qualified for instant approval, the borrower must have a good or excellent loan. The minimum credit score is 650, but most credit card issuers have a minimum requirement of 670-700 credit score.
The borrower is advised not to apply for any type of loan too often. Usually, lenders trust potential borrowers less in the credit history of which there are several hard inquiries made in a short time.
Ways to Use an Instant Approval Virtual Credit Card
Instant approval credit cards are suitable for all the same purchases as the traditional physical credit card.
With this card, the borrower can make an online purchase since such a card offers immediate access to the card details that the holder can enter on any website.
The borrower can add this credit card to the digital wallet on the mobile device to make in-store purchases. However, they should carefully study which stores support this payment method. In general, most shops, gas stations, restaurants, and other establishments have long supported all known payment methods.
Once you earn rewards, you can redeem them for gift cards, cash back, other purchases, and statement credits. If you manage the card responsibly, you can improve your credit score and increase your credit limit. This will allow you to upgrade for better credit cards.
