Virtual credit cards (VCCs) are an emerging trend in Malaysia, with an increasing number of card issuers, such as banks, trying to attract customer demand for more secure payment methods for online transactions. Gen Y and Gen Z are identified as the popular demographic interested in VCC’s offerings.
Malaysia’s first fully VCC for individuals was introduced in February 2022 by Alliance Bank Malaysia Bhd, known as the Alliance Visa Platinum VCC. Alliance Bank’s Group Chief Consumer Banking Officer Gan Pai Li highlighted that the VCC has incorporated security elements using tokenization or dynamic card numbers, so the customers’ credit card footprint is no longer visible on various online channels, which alleviates concerns about credit card details being accessible to third parties. Each consumer can choose a unique security number to be used for a specific transaction with the VCC. Plus, users of the VCC are not required to pay an annual fee and can use the MCash mobile app to make JomPAY and QR code payments as well as access cash advance services. The firm aims to expand the VCC’s features to include more partners for e-commerce transactions, streaming and subscription services.
According to Visa Malaysia, VCCs are becoming popular due to the wide range of applications anywhere in the world. People are shifting away from utilizing cash as a result of the pandemic, and consumers now have the option of paying with a linked device such as an e-wallet or QR Pay. It was noted that physical cards would continue to be the major payment method, however, consumers are increasingly choosing to pay with a connected device such as an e-wallet or QR Pay. In addition, a survey on Visa consumer payment attitudes in seven Southeast Asia countries in 2021 found that around seven in 10 (69%) of Malaysian consumers are interested in adopting VCCs for their daily purchases and financial transactions. The total sample size was 6,520, comprising 1,000 consumers in Malaysia, aged 18 to 65, with a minimum income of MYR 2,000 (USD 470).
(Sources: The Edge Markets; New Straits Times; Ringgit Plus)