Virtual cards offer many advantages over traditional cards: they're more secure (there's obviously no danger of someone stealing your card), they can held by anyone of any age, you don't need a bank account and there's no credit application. There are also no interest payments, as you pre-pay them in the same way you would pre-pay a mobile phone card. As such, they're probably more accurately described as 'virtual debit cards'.

You can purchase a card in person (at your nearest Mobile/Quix) or over the Internet (at http://www.virtualvcard.com.au/) using BPay. You prepay an amount to put on the card (up to $1,000) and then activate the card on a secure website. The card number, expiry date and three digit CVV code are then sent to you via e-mail or SMS.

However, the concept does have its problems. The card doesn't offer a top-up feature, so when the credit on your card expires, you'll need to purchase a new one with a new credit card number. While this is good for security (you'll probably have changed numbers by the time someone who has obtained your card number has an opportunity to use it illegally), it means the card isn't good for subscription arrangements like e-billing. It's also a problem if you have a small amount of credit remaining on your card, as redeeming your balance for cash incurs a $10 fee and you cannot merge the credit from two cards.

Obviously, the card can only be used online or over the phone, so you shouldn't cut up your physical cards just yet - you'll still need them to make purchases at stores.

The card also has a $5.50 set up fee and a high foreign currency conversion rate (3.5%).

On a moral note, as you're not required to prove your identity to obtain one, it also may provide criminals with tools to avoid identification in making illegal or incriminating purchases.

What next?

• Compare all credit cards
• Read other articles
• Read credit card reviews