Hacker News Reader

Comment by remote_phone | Hacker News Reader

With fraud protection that is mandated by the government, and that most credit card companies provide, virtual credit cards are not necessary.

All that does is push the burden of fraud management into consumers when it is clearly the fault of merchants, processors and credit card companies.

By implementing things like virtual cards or even PIN numbers, they are doing this to limit their own liabilities and push the burden onto consumers. Currently, consumers don’t need protection. The protection from credit card fraud is largely excellent, at least in the US.

We as consumers should not let this erode away by these articles trying to convince us that credit card fraud is our problem, not the credit card companies’.

View on HN

It's simply an act of giving control to the customer - nobody likes sitting on the phone for a few hours with your bank's fraud department and then waiting a week to get a new card in the mail. Being able to cancel a single merchant's card without affecting anything else in your life is a net-positive.

Virtual cards are also good for the customer outside of general fraud, such as when you might have a stingy business that only cancels subscriptions over the phone or whatnot; the only downside is that technically the business can send those charges to collections, but even then most small collections charges aren't considered in credit decisions.

You don’t need to manage your credit cards. The only reason why you need to is because the credit card companies have developed a flawed system that makes transactions very easy without any security. But they designed it this way so that payments are frictionless.

If this is the system they want, they should deal with the consequences. The burden of fraud, etc should rest on their shoulders, and it currently does. The more burden they put on our shoulders, the less it is for them. It’s like boiling a frog. When they implement PIN numbers, then they will be able to completely put the burden of liability on our shoulders. They want the convenience of quick payments with none of the liabilities.

What you’re talking about is presumably hundreds of virtual credit card numbers being distributed, which is even more of a burden for us. And then figuring out which number to cancel etc.

Credit card companies currently have a lot of incentive to catch fraud early because if you need to cancel a card, you will switch it to another card from another company, presumably.

Let them handle it.

> They want the convenience of quick payments with none of the liabilities.

All payment systems are moving in that direction: PayPal, any RTP like PayTM, cryptocurrencies, etc. You (the consumer) control the account and the transactions are easy to make. If you want to revert a transaction, you have to prove that you lost control of the account in a way that is not your fault. And even then you may not have a recourse other than going through the legal system.

(Self-custody has benefits and costs.)

Merchants eat the majority of fraud costs not the credit card companies. It is up to them verify billing address and whether to allow a shipment to another address. Only time credit card company will eat the fraud is on a stolen credit card that is used in a chip based payment. Card not present is still on the merchant.

Agree.

There are also ways to avoid subjecting merchants to the responsibility of securing credit card data in the first place, like the Click to Pay initiative launched last year by Mastercard, Visa, American Express and now Discover. Merchants cannot lose data they never have.

Tokenized payments also work to help avoid giving data to Merchants, via services like Apple or Google Pay. Other PSP services can serve a similar role like Pay with Amazon or PayPal.

This offers protection for users of debit cards.

I don't personally use credit cards at all, for a variety of reasons. Virtual card #s on my debit cards are very desirable when it comes to online purchases, especially with vendors that don't accept paypal.

...agreeing with you, there is a lot of Government Required consumer fraud protection built in to Credit Cards.

Reply on news.ycombinator.com