BUSINESS NEWS - FNB will roll out virtual card functionality to its entire customer base across credit cards, debit cards, fusion cards and business debit cards by October – before the peak annual shopping season, which starts with Black Friday in November.
An internal pilot has been followed by a launch to all FirstRand staff on Tuesday. The bank will be among the first to roll out these virtual Visa cards to clients in South Africa, but a number of other banks and fintech startups globally already issue digital cards.
FNB customers can create as many of these virtual cards in the FNB app as they like. These cards, linked to their existing accounts, do not attract any additional charges. Customers will be able to block, cancel or replace cards from within the app.
There are some significant security benefits to virtual cards, chief among these that they have a dynamic CVV (card verification value) number that changes every hour. Senzo Nsibande, Head of Card Fraud at FNB says an obvious additional advantage is that the card is stored behind log-in on the FNB app. Because of the added security, the expiry date of the virtual card is also longer (five years, versus three for physical cards).
Virtual card e-commerce transactions will be approved in the app itself. This avoids potential problems during high-volume periods with delayed one-time PINs. All banks are highly reliant on the mobile operators for these messages, and FNB believes Smart inContact is a more elegant solution over which it has control.
Additionally, an enhanced risk-based authentication system will build out a digital profile of customers, including the devices used. This means, says Nsibande, that the bank may decide not to challenge the kind of transaction (think an Apple Music or Netflix subscription) that happens at the same time/same value each month.
Those outside of “normal behaviour” would need to be approved.
A further benefit of the virtual cards is that instead of needing to cancel a customer’s full physical card after a fraud event, the two worlds are “divorced”, and a new virtual card can be issued without worrying about the physical card (which typically takes around three days to be delivered).
“This elevates the convenience factor tenfold,” says Nsibande. Customers could, for example, create a virtual card for all their online purchases and another for in-store transactions.
