Virtual Entrepreneur

PayPal Providing Virtual Debit Cards

July 6th, 2006 | Author: MrMoney

via Ty Tribble – eBay Business Opportunities

PayPal Inc. will start rolling out its so-called virtual debit card to ‘hundreds of thousands’ of users some time this month in a process it expects to complete by the end of August, a spokesperson for the San Jose, Calif.-based unit of online auctioneer eBay Inc. tells Digital Transactions News. The product, which relies on software that generates one-time-only account numbers and is now being tested by PayPal employees, should be generally available to the online transaction processor’s 105 million accountholders by year’s end, the spokesperson says.

The virtual debit card deducts funds from users’ PayPal accounts and can be used at any Web merchant that accepts MasterCard, expanding PayPal’s reach beyond those sites that accept PayPal. To make it work, the user downloads an application that becomes part of his computer’s toolbar. When the user visits a MasterCard- accepting site, the application generates a prepopulated form for payment, including a one-time account number and one-time card-verification value, the 3-digit number usually found to the right of the signature panel on the back of physical cards.