This would let me keep track of the services that I have so I don't end up with subscriptions to sites or services that I've forgotten about. It would also let me revoke permission to charge the account at any time. No need to cancel a card if one won't cancel or changes the fees--you just revoke their permission individually.
It is widespread and the norm for subscriptions.
We also have iPhone and Android app's where you can create these Masked Cards in stores as you're about to check out. Cashiers just need to be willing to type in the 16 digit # and expiration, which they usually are fine with.