Did you know that both Citibank and Discover offer disposable “virtual card numbers” you can use to buy stuff securely online? If you use either of these card companies, you should acquaint yourself with this incredibly useful tool. It has a variety of applications beyond just the obvious (protecting your real card number).

Briefly, here’s how virtual card numbers work. You go to your card company’s website. You log in. You get a card number which is attached to your account but not to any actual, physical card. It has its own expiration date and its own security code. You use it to buy stuff online. Even if the merchant leaks your card number or hackers get their hands on it, it doesn’t matter. The card number expires after the purchase is complete.

Citibank lets users customize their virtual cards, specifying expiration dates and credit limits which don’t necessarily have to have any relationship with the expiration date or credit limit of the actual, physical card. This is a really nice service which I only discovered about a year after becoming a Citibank card-holder. I now use it frequently.

I recently used a virtual card number when I signed up for Shoppers Advantage, a discount buying club operated by Trilegiant, a company I now know to be dishonest and generally naughty. I paid $1 to enroll. The purpose was the $20 AMEX gift card I got out of the deal (but only after complaining to the BBB that I didn’t get it despite repeated promises on the phone). I canceled my membership within the 30-day trial period and was not supposed to be charged any monthly fees, but lo and behold, Shoppers Advantage tried to charge on my card to the tune of $15 or so. Since I’d used a virtual card number with a $1 limit, the charge did not go through. True, most major credit cards offer zero liability for unauthorized charges, but this way, I didn’t have to go through the hassle of proving to Citibank or to Shoppers Advantage that I had actually canceled my membership.

In the case above, the merchant attempted to charge me even though I’d already canceled my membership, but even if I’d forgotten to do so, I still would have been protected. The company simply wouldn’t have been able to charge me its monthly fee. If you’ve signed up for some sort of trial membership or when a company is going to try charging you periodically and you don’t want it to happen, consider using a virtual card number.

Here’s another situation in which a virtual card number could be very useful. Let’s say you go to the Papa John’s website and order a pizza and that afterwards you respond to the offer inviting you to sign up for a free Entertainment Weekly trial subscription and get a $10 PJ’s gift card. Of course, if you forget to cancel the trial subscription, you’ll be charged for an annual subscription to the magazine. This way, you don’t have to remember. Create a virtual card number with a $1 limit and forget about it.

Some folks might question the morality of this. I mean, it really is your responsibility to adhere to terms you’ve agreed to and cancel your subscription/membership/whatever. And the company could do something crazy like turn you over to a collections agency (I’ve seen it happen even for tiny debts). Everybody will have to weigh out these factors individually.

Card companies are reporting that usage of virtual card numbers if very low and I think is mostly due to lack of public awareness. If your card company allows you to create a virtual card number, keep this in mind the next time you purchase something from an online merchant you wouldn’t exactly trust with your life. A virtual card number could save your butt, or at least save you a few bucks.

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