More companies are offering virtual debit cards. Though MasterCard debit card seems to be the largest stakeholder in this new development in the prepaid debit cards service (with the Obopay and PayPal virtual debit cards), Visa debit card has also entered the market with the launch of products such as ePassporte’s Visa virtual debit card.

Virtual Prepaid Debit Cards

Sometimes mistakenly called virtual credit cards, the prepaid debit cards are considered virtual because there is no paper or plastic generated. As a new development in electronic transactions, it is difficult to provide an explanation of the virtual debit card without looking at the features provided by specific virtual debit card providers.

How the Virtual Debit Card Works

There are no physical cards and no point-of-sale purchases that require debit card swipes. They are sometime referred to as anonymous debit card transactions. PayPal offers the virtual debit card as a plug-in for Firefox and Internet Explorer browsers that process transactions through the MasterCard service. The Obopay virtual debit card also can be used in online stores or by phone, but tends to have more associated fees.