Finance

CVV: WHAT EVERY TRADER SHOULD KNOW ABOUT IT

Receiving payment through debit or credit card is not only easy, but convenient as well. Research by the American Bankers Association reveals that over 90% of American merchants prefer credit cards to cash. 

For a stress-free cash reception experience, it is essential to familiarize yourself with every seemingly minor detail regarding credit cards, including their CVV number.

CVV Explained

If you do not accept credit cards at your store or have never delved deeper into what they involve, you are probably wondering what CVV means. Short for Card Verification Value, a CVV is a special three-digit code on Discover, VISA, and MasterCard branded credit and debit cards needed to complete transactions using credit or debit cards.

On the above branded credit cards, it is located at the rear of the card and is usually to the signature panel’s right. On American Express-branded cards, it is a four-digit code and is found on the front end of your card, usually printed directly above the card number on the far-right end.

It is also known as a CVV2 number for VISA, CID (Card Identification Number) for Discover, CVC2 (Card Validation Code) for a Mastercard, and CSC (Card Security Code) number for a Debit Card. CVV2 numbers are similar to CVV digits, save for the fact that the former have been generated by a 2nd generation process, making them more difficult to guess.

The codes add an extra layer of security to transaction scenarios where you as an operator cannot physically confirm that a client is the actual cardholder. 

What’s the Difference Between CVV and a PIN Number?

Simply put, a CVV appears at the back or front of a card-depending on what brand it is-and is ordinarily used as a security feature when a PIN cannot be used. A perfect example is when a client is making a purchase online. The card issuer automatically generates them.

A PIN, on the other hand, helps clients make secure transactions at an ATM or bank and is not printed on their card. 

How Are CVVs Created?

When it comes to the safety of digital transactions, banks leave no stones unturned. The introduction of a CVV is proof of this.

CVVs aren’t some random digits that banks make up. Financial institutions generate them using four pieces of information, namely:

  • A three-digit service code
  • A primary account number
  • A pair of DES, or Data Encryption Standard, keys and
  • Four-digit expiration date

Are CVVs Reliable for Your Business?

CVVs are reliable, but only when used properly. Some operators do not spare some time to learn how a CVV works and it costs them in the long run. Why? Because though it is difficult to crack a CVV code, fraudsters do so once in a while. You can be the victim of a chargeback without proper preparation.

Reasons to Accept CVVs in Your Business

Most operators prefer cash-only payment with a good reason: It is a highly familiar technique. With the advancement of technology, however, come countless payment methods, including CVV.

If you are still skeptical about accepting CVV, here are some reasons to do so that are sure to change your mind:

  1. They Keep Your Business Safe

Before the introduction of Card Verification Value, cybercriminals easily crafted fake cards and used them after obtaining personal details of unsuspecting victims. Merchants counted losses as card owners complained and fraudsters got away with it.

Thanks to the safety feature in CVVs, you don’t have to worry about complaints from your customers.

  1. They are Widely Used

Second to the cash-only payment method, more customers today prefer using credit cards for payment as they are convenient. By accepting CVV, you put your establishment a step ahead of the rest.

  1. They Establish Trust Between You and Your Clients

Since purchases with CVVs are seamless, the relationship between you and your customers will be stronger. They know they can always rely on your business.