Virtual Prepaid Card: How It Works and Which One to Send

A virtual prepaid card is a Visa or Mastercard that exists only as digital card details (a 16-digit number, an expiration date and a CVV), loaded with a set amount before anyone spends it. For a business, it’s a reward the recipient can spend almost anywhere that card network is accepted, as long as you match the card to the country they live in and they spend it before it expires.

TL;DR

• A virtual prepaid card is a digital Visa or Mastercard loaded with a fixed amount: the sender funds it, the recipient claims it from a reward link, and it spends like any card until the balance or the expiry date runs out.
• Which virtual prepaid card to send depends on where the recipient lives: a US or Canada card works only in its own country, while a global card covers most countries but charges fees on non-USD purchases.
• Check each card’s expiry date and what it won’t do, such as cash withdrawals and most subscription billing, and put both in the reward message.
• On Giftronaut, a prepaid card’s number and PIN are generated only when the recipient clicks the redemption link, and the Refund Option can return part of the value of rewards nobody claims.

For a long time, I thought a prepaid card was just a gift card with a Visa logo on it. Then a friend got one as a thank-you for speaking at a meetup. It paid for her groceries that evening without a hitch. The next morning it refused her streaming subscription, and she texted me: “It works everywhere except the one place I wanted it.” I’d been recommending that kind of card to teams for months.

If you’re about to send virtual prepaid cards to employees, customers or research participants, that gap between “works almost anywhere” and “works for what they actually want” is the thing to plan around. Here’s what these cards are, how they work from the sender’s side, and how to pick the right one for each recipient.

What is a virtual prepaid card?

A virtual prepaid card is a payment card with no plastic: the recipient gets a card number, an expiration date and a security code (CVV), and the money on it is loaded in advance. Because it runs on a card network such as Visa or Mastercard, it’s accepted by merchants that take that network, online and, through a phone wallet, in many stores.

Three ideas sit inside that definition, and each one matters when you’re the one sending it:

• Virtual means the card is a set of details, not an object. Nothing gets mailed, lost in a mailroom or left in a desk drawer. The recipient opens a link, sees the details and starts using them.
• Prepaid means the balance is fixed when the card is issued. The recipient can’t overspend it, and nobody is lending them money. When the balance hits zero, purchases decline.
• Open loop means the card works at many merchants rather than one brand. That’s the main difference from a store gift card, which only works with the brand that issued it.

The Consumer Financial Protection Bureau explains the core idea in one line: prepaid and debit cards are ways to spend money you already have, while credit cards are ways to borrow money (last reviewed October 2023). For a reward, that’s the appeal. The recipient gets spending power with a clear limit, and you know exactly what each card costs before it goes out.

Recipients seem to like that flexibility, too. Among Giftronaut recipients who pick their own reward, the Visa Reward Virtual Account is the second most-chosen product, picked 3,828 times, behind only Amazon.com (Giftronaut data, September 2026).

How does a virtual prepaid card work?

A virtual prepaid card works in two halves: the sender funds and orders the card, then the recipient claims it and spends it like any other Visa or Mastercard until the balance runs out or the card expires. Here’s how that plays out when a business sends one as a reward.

On the sender’s side:

1. Fund your account. With Giftronaut, the account is pre-funded in USD before any order goes out, by credit card, ACH or wire.
2. Pick the card for each recipient’s country. A US card for US recipients, a Canadian card for Canada, and a global card for everyone else (more on that choice below).
3. Set the amount and send. Each card has a minimum and maximum load, and you send it by email, by text message or as a reward link you share yourself.

On the recipient’s side:

1. Claim the card. The recipient opens the reward link and confirms it’s them. On Giftronaut, a prepaid card’s number and PIN are generated at the moment the recipient clicks the redemption link, so nobody can have used the card before they did.
2. Spend it online. At checkout they enter the card number, expiration date and CVV. Giftronaut’s Help Center tells recipients to choose Credit if the checkout asks for debit or credit.
3. Spend it in a store. Giftronaut’s prepaid cards can be added to Apple Pay or Google Pay for tap-to-pay. Wallet setup has its own steps, and our guide on where to use a prepaid Visa card online and in store walks recipients through them.
4. Watch the balance. Every purchase, including tax, shipping and tips, has to fit inside the remaining balance, or the card declines.

Giftronaut’s prepaid reward cards are single-load. The card can’t be topped up, and when the balance is spent, it closes. That’s different from the reloadable prepaid cards people buy for personal budgeting, and it’s why the amount you choose at order time is the amount the recipient gets, full stop.

Virtual prepaid debit card or prepaid virtual credit card: what’s the difference?

A “virtual prepaid debit card” and a “prepaid virtual credit card” are usually the same product described two ways: a card loaded with money in advance that runs on a credit card network. Neither one is linked to a bank account, and neither one is a loan. The confusion comes from the logo, because prepaid, debit and credit cards can all carry the Visa or Mastercard mark.

Here’s how the three actually differ:

So when someone searches for a “prepaid virtual credit card” to send a team, what they want is the first row. The word “credit” also turns up at checkout, where a page may ask whether you’re paying by debit or credit, and Giftronaut’s Help Center tells recipients to pick Credit.

There’s a business-side version of the same mix-up. Many companies already use virtual cards for spending, such as a card number for a software subscription or a marketing budget. Those are expense cards: they stay with the company. A reward card goes to a person and becomes theirs. If your search turned up expense-card vendors, our explainer on reward cards versus expense cards sorts the two.

Virtual prepaid card or gift card: which should a business send?

A virtual prepaid card fits when recipients need to spend the reward in many places, and a brand gift card fits when you know which store they’d pick or want the reward to feel like a treat rather than cash. It comes down to flexibility against simplicity, and the right answer changes with the recipient.

The expiry row is the one people miss. Most Giftronaut gift cards don’t carry an expiration date, and where one applies it’s usually 12 months, set by the brand. Giftronaut’s US and Canada virtual Visa cards, by contrast, expire six months after issue. A prepaid card wins on flexibility and loses some of it back on time.

You don’t always have to choose for the recipient. A Choice Card lets each person pick at redemption from 4,300+ brands, including Visa prepaid cards where they’re available in their country. If you want the full side-by-side for a team, our post on digital gift cards versus prepaid cards goes deeper.

Virtual and physical prepaid cards differ mainly in delivery: a virtual card arrives as card details by email or text, while a physical card is plastic that has to be shipped and can carry shipping or replacement fees. Our guide to virtual vs. physical Visa gift cards weighs the two.

Which virtual prepaid Visa card should a business send?

The best virtual prepaid Visa card for a reward is the one that works where the recipient lives. A US card is the simple choice for US recipients, with no fees, a Canadian card does the same job in Canada, and a global card covers recipients everywhere else, with fees on purchases in other currencies.

Many “best card” lists skip that part, because they’re written for one person buying a card for themselves. When you’re sending to a team, the recipient’s country decides the card before anything else does.

Here are the four Giftronaut options and where each one works, from Giftronaut’s prepaid card page and Help Center:

And the costs and limits that come with each:

A few things follow from those tables:

• Don’t send a US card abroad. The recipient’s home address doesn’t change where the card works. A Canadian resident who gets a US Visa can only use it for purchases in the United States.
• Global cards cost the recipient something on local purchases, about $6 of a $100 Global Visa Reward Card spent in euros.
• Mastercard is the other global route. The Swype Global Mastercard has its own fee pattern and a longer life. Our post on the prepaid virtual Mastercard covers it in detail, and international use of Visa cards in general is covered in international Visa gift cards.
• For a mixed group, let people choose. With a Choice Card, each recipient selects their country at redemption and picks from what’s available there, which avoids sending the wrong country’s card in the first place.

Fees on the sender’s side are a separate question. Store-bought Visa gift cards commonly add a purchase fee of about $3 to $7 per card, according to Giftronaut’s Help Center, which is why we wrote a separate guide to Visa gift cards with no fees.

Virtual prepaid cards for business: where do they fit?

Virtual prepaid cards fit business rewards and incentives: thank-yous for employees, payments for research participants, customer incentives and sales prizes. The card suits any reward where the recipient’s preferences vary and you’d rather not guess a brand.

Here’s where they tend to fit, and what to watch in each case:

• Employee recognition. A prepaid card works for a distributed team when you match the card to each person’s country. For employees, there’s also a tax point: the IRS says gift cards are cash equivalents that are never excludable as a de minimis benefit, however small (IRS Publication 15-B, 2026). In practice they run through payroll, so check with your payroll team before the order goes out.
• Research and survey incentives. Participants may live in different places and rarely share a favorite store. For anonymous studies, Giftronaut can issue reward links instead of emails, so you hand out links yourself and never upload a list of participant emails.
• Customer and referral incentives. A prepaid card reads as close to cash without being cash, which suits a thank-you for a review, a referral or a completed onboarding.
• Sales incentives. A contest winner can use the card right away, wherever they are, without waiting for a payroll cycle.

Volume changes the job more than the use case does. Sending one card is a form. Sending 300 is a spreadsheet, a funding decision and a plan for the questions recipients will ask. If you’re ordering at that scale, our guide to bulk prepaid Visa and Mastercard gift cards covers the ordering side.

The funding side is simpler math than it looks. Take a 40-person team getting $50 each. That’s $2,000 in rewards. Funded by ACH or wire, Giftronaut adds no funding fee, so the total is $2,000. Funded by credit card, the 3% processing fee adds $60, for $2,060. Either way, the recipients’ cards carry the full $50.

What happens when a virtual prepaid card expires or isn’t used?

A virtual prepaid reward card stops working at its expiration date or when the balance reaches zero, whichever comes first. For Giftronaut’s US and Canada Visa cards and the Global Visa Reward Card, that date is six months after the card is issued, so a card issued in March has to be spent by September.

That leaves two different ways a reward can go unused, and they need different fixes:

1. The recipient never claims it. The email sits unopened, or the link gets buried. Giftronaut’s Refund Option handles this case: chosen when you place the order, it pays back 50%, 40% or 30% of the value of rewards that were never redeemed, for a 30-, 60- or 90-day redemption window. It only applies to fully unredeemed rewards, and it can’t be added after the order is sent.
2. The recipient claims it and leaves a balance. Someone spends $41 of $50 and forgets the rest. Once a reward is redeemed, even partially, the Refund Option no longer applies, so the fix is communication, not a refund.

The communication part is cheap. Put the expiration date in the reward message in plain words, mention that the card can’t be reloaded, and tell people how to check their balance. On Giftronaut, recipients can return to their original reward email and follow the link to see the remaining balance and transaction history.

Choosing a Refund Option window also shortens the recipient’s deadline to claim, from the standard 180 days to the window you picked. That deadline appears in the reward email, so mention it in your own message too.

What should you check before sending virtual prepaid cards?

Before you send, check five things for each group of recipients: the country, the amount, what they’ll spend it on, how they’ll receive it and what to tell them. Each takes a minute up front, and each one you skip tends to come back as a recipient’s question.

1. Country. Match the card to where the recipient will spend it, not where your company is based. US recipients get the US card, Canadian recipients the Canadian card, and everyone else a global card or a Choice Card.
2. Amount. Stay inside each card’s own minimum and maximum: the US and Canada cards go up to $1,000, the Global Visa Reward Card up to $500. For a restaurant reward, leave room, because restaurants and similar merchants may pre-authorize up to about 20% more than the bill to cover a tip.
3. What they’ll spend it on. Giftronaut’s Help Center lists what US and Canada virtual Visa cards commonly don’t support: ATM withdrawals, cash back, cash advances, recurring or subscription billing, and some high-risk merchant categories. If the reward is meant for a subscription, a prepaid card is the wrong tool.
4. Delivery channel. Email reaches recipients wherever they are. Text messages reach US and Canadian mobile numbers only, so for recipients elsewhere, use email or a reward link. Corporate security filters sometimes hold reward emails; the fix is asking their IT team to allowlist no-reply@giftronaut.com and the giftronaut.com domain.
5. The message. Tell recipients what the card is, when it expires, that it can’t be reloaded, and to pick Credit at checkout. Recipients also shouldn’t use a VPN when activating or paying, because it can trigger fraud checks and declines.

The fifth point does the most work for the least effort. A recipient who knows the card’s limits uses it. A recipient who finds them out at a checkout writes to you instead.

How Giftronaut sends virtual prepaid cards

Giftronaut sends prepaid Visa and Mastercard rewards and gift cards from 4,300+ brands on one platform, reaching recipients in 225 countries. Here’s what that covers for a prepaid card program:

• The right card by country. US and Canada Visa cards for those countries, plus the Global Visa Reward Card and the Swype Global Mastercard for recipients elsewhere, or a Choice Card so each person picks.
• Three ways to deliver. Send by email, by text message to US and Canadian mobile numbers, or as reward links you share in your own channel. Send right away or schedule the order for later.
• Your brand on the reward. Set the sender name, subject line, message, logo and brand colors, and translate the reward email into any of 15 languages.
• Sending at any scale. Upload a spreadsheet to send one card or thousands, or automate sends with Zapier, MCP or the Giftronaut API.
• Clear costs. No platform fees: you pay face value. ACH and wire deposits are free, and credit card deposits carry a 3% processing fee. The US and Canada Visa cards charge recipients no activation, maintenance or inactivity fees.
• Budget protection. The Refund Option returns 50%, 40% or 30% of the value of unclaimed rewards, depending on the window you choose when you order.

Your account needs funds before an order can go out, and the minimum deposit is $100. The International Visa gift card page has the full card-by-card details, including the Visa Grocery Card for US grocery rewards.

Start with where the card will be spent

These days, before I suggest a prepaid card to anyone, I read the list of what it won’t do first and the list of what it will do second. My friend kept her subscription on her own card. She still calls the prepaid one her grocery card.

For your first order, group recipients by country, pick the matching card for each group, and write the expiration date into the reward message before you send. If a group is mixed or you’re unsure, a Choice Card lets each person make that call themselves.

Frequently Asked Questions

Can you use a virtual prepaid card for subscriptions?

Usually not for recurring billing. Giftronaut’s US and Canada virtual Visa cards list recurring and subscription billing among transactions they commonly don’t support. One-time online purchases work wherever Visa is accepted in the card’s country.

Is a virtual prepaid card the same as a Visa gift card?

Often, yes. A digital Visa gift card is a virtual prepaid card: a Visa loaded with a fixed amount, delivered as card details. A store gift card is different, because it only works with one brand.

How do virtual and physical prepaid cards differ?

A virtual prepaid card is delivered as card details, a 16-digit number, an expiration date and a CVV, so there’s nothing to ship or lose. A physical prepaid card is plastic, and it may carry shipping fees and a replacement fee if it’s lost. Giftronaut’s prepaid cards are digital only, and recipients can add them to Apple Pay or Google Pay to pay in stores.

Why would a company reward people with a virtual prepaid card?

A virtual prepaid card gives each recipient a set amount to spend at merchants that accept its card network, so you don’t have to guess a favorite store. You know the cost before it goes out, and you need no bank details from recipients, only an email address, a US or Canadian mobile number, or a reward link. Giftronaut delivers the card within seconds, and the recipient can use it right away.

Can recipients withdraw cash from a prepaid Visa reward?

No. Giftronaut’s US and Canada virtual Visa cards don’t support ATM withdrawals, cash back or cash advances. The Global Visa Reward Card and Swype Global Mastercard can’t be used at ATMs either.

Could anyone use a prepaid reward card before the recipient claims it?

No. A Giftronaut prepaid card’s number and PIN are generated when the recipient clicks the redemption link. The card can’t have been used by anyone before that point.

Are prepaid card rewards taxable for employees?

Yes, for employees in the US. IRS Publication 15-B says gift cards are cash equivalents that are never excludable as a de minimis benefit. Check how your rewards are handled with your payroll team or tax adviser.