Innovations and Payment Systems

Citi offers virtual account numbers to wary online shoppers

For the first time since the advent of the Internet, online shopping expenditures funded with credit cards are projected to exceed those of brick and mortar stores this holiday season. Maybe it’s being driven by people’s desire to avoid the crowds at the shopping mall or perhaps American’s have just become more comfortable with using their credit cards for online shopping.


After all, Visa and MasterCard have spent millions of dollars on advertising the fact that their credit cards offer zero liability in the case of unauthorized purchases. These messages have been squarely aimed at easing any anxiety over online shopping, since this is clearly a growth area for credit card issuers and merchants.

But Citibank has raised the online security bar another notch. Now, Citi card members can register their existing Citi credit card on the Citibank website to access virtual, randomly assigned card numbers. These numbers are connected to the card members existing account but are for one-time usage when shopping online. This way, the card member’s real account number is never used in an online purchase transaction.

The only limitation of this technology is that virtual one-time use account numbers can not be used for purchase items that will be picked up in person. This is because the card member’s physical card won’t be able to be used for verification, since the account number is different from the one-time use number. Examples of these types of situations include online ticket purchases that must be picked up at a will-call window or online electronic purchases that are ordered online and picked up at a local store.

While this layer of protection can help many people sleep better at night, probably the most effective way to ensure online shopping safety is to be selective where you shop. Most credible online merchants offer secure checkout procedures that can be verified by seeing “https” at the beginning of the URL address of the page in the internet browser window. This indicates that any personal or financial information transmitted over the internet uses sophisticated encryption technology.

But for some, secure checkout technology and zero liability just aren’t enough to put their minds at ease. And it is this segment of online shoppers that the virtual account number service at which Citi is aiming. It’s probably a bit of overkill when it comes to protecting information, especially since the same people that demand this level of protection often don’t think twice about giving their credit card and social security number over the phone. Phone calls can potentially be intercepted – especially if the call is made with a cell or cordless phone.

If you find yourself feeling a bit nervous when getting ready to hit the submit button on your next Internet purchase, you might find this Citibank virtual random digit technology comforting. Otherwise, you are probably just as well off doing your shopping on a nice secure, well-known retailer’s secure website. Either way, it’s better than fighting traffic.

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Published: January 18, 2006

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