CVV2 codes are three-number security codes found on the back of most VISA cards used to prevent fraud during phone or internet purchases. Credit card companies use response codes to authenticate transactions, and merchants cannot store security codes on file.
A CVV2 code is an acronym for Card Verification Value 2. Found on the back of most VISA cards, the CVV2 code is a three-number card security code. CVV2 codes are used to prevent fraud when purchases are made over the phone or the Internet. During purchases, merchants send the CVV2 code with other purchase information and wait for authentication. Merchants, however, cannot save security codes on file.
Credit card thieves and frauds called carders often attempt to use stolen credit card numbers that they have gathered from credit card receipts or intercepted over the Internet. Since they do not have the physical card, they can try to make purchases by phone, Internet, postal mail or fax. Known as CNP, or Cardless Purchases, they are therefore vulnerable to fraud and a challenge for credit card companies.
To ensure transaction security, most major credit cards have a PIN code or three-digit code encoded on the card’s magnetic stripe to ensure ownership of the card during in-store purchases. A second security feature, called a CVV code, or card verification value, is located on the back of the card. Guarantees ownership when the credit card is used and the card is not physically available for verification.
The VISA credit card company calls the three-digit code CVV2. Mastercard calls the CVC2 code, or card validation code, and it’s also a three-digit code. Both are found on the back of the card after the 16-digit account number, next to the signature. American Express has its own version called the CID, or card identification number, which is a four-digit number found on the front of the card, next to the account number. Other companies have similar security codes.
When CNP purchases are made, the merchant sends the amount, name on the card, account number, expiration date, and CVV2 code to the credit card company and waits for approval. The credit card company returns a response code and an explanation code whether or not the transaction went through. If the CVV2 code matches the code in a file, the response code is M, otherwise it is N. Merchants cannot store security codes for any reason, although they can force a CNP through without a code.
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