CVV number is a 3-digit code from the back of your credit card. It is used to verify your identity when you make a purchase online.
Credit cards are an essential part of modern life, and for good reason. Not only do they allow you to spend money easily and conveniently, but they also come with a number of benefits, such as fraud protection and security. In order to make the most of your credit card and take advantage of all its features, it is important to know what your credit card CVV number is.
What Exactly Is A CVV Number?
A CVV number is really an abbreviation for Card Verification Value. It is required to complete card transactions, but it also provides additional security against fraudulent activities. When you make an online or phone purchase, the CVV number is used to verify that you have the card in your possession. Since the number is not printed on any receipts or statements, only the person who has the physical credit card knows what it is.
This number typically has three digits, like those used by Visa and MasterCard, but American Express uses four. On the back of the Card, it is close to the signature area.
The CVV number is distinct and is not based on the cardholder's card number, PIN, or card expiration date. The CVV must be entered accurately in order for the transaction to be successful. This is because the procedure needs two levels of authentication, including the right card number and CVV number.
This makes sense because it assumes that the person using the Card actually possesses it and is therefore its legitimate owner.
CVV numbers are also identified as CSC numbers ("Card Security Code") and CVV2 numbers, that are identical to CVV numbers but have been engendered through a second generation method that renders them more difficult to deduce.
Why Is The CVV Number Used?
Every financial institution that issues credit or debit cards has created a system where each card is given a distinct CVV code. Any financial transactions made with the card must be completed using this code. The PIN number, which functions as a sort of password to complete card transactions, is distinct from the CVV number. The magnetic strip on the back of your card contains the CVV number. It confirms that the card is actually present when it is being used for the transaction.
How Does CVV Protect Your Transactions And Credit Card Against Fraud?
CVV number offers a second layer of protection to online transactions. Even if fraudsters steal your credit card information, like card number and expiry date, they still can't use it without the CVV number. So basically, CVV number protects your credit card from online fraud.
What If Your Credit Card Is Stolen?
Yes, it is a risk if your credit card is stolen; the thief has access to your credit card number and CVV, which can be used to make fraudulent purchases. That is why credit card companies came up with the idea of a PIN number. A 4-digit PIN is to be entered every time you make a purchase at merchant locations. This served as the second layer of protection for merchant transactions.
Is My CVV Information Stored By Online Merchants?
No. Though your card number and expiry date are stored, your CVV is not stored. So you need to enter it every time you make a purchase.
Is CVV Truly A Fool-Proof Safety Measure?
While CVV served as an additional layer of security, hackers found ways to compromise the system. A few years back, scamsters used to send SMSs and emails to credit card users in the name of friends, banks or government agencies requiring them to complete an imminent transaction, which required them to enter their CVV number. While the transaction was fake, scamsters acquired the CVV number to use in subsequent fraudulent transactions. They either purchased goods online or transferred money from the credit card account into their own. Thousands of customers across the world fell prey to this scam and lost millions of dollars to these novel thieves. That is when the credit card companies came up with a new security measure, OTP.
What Is OTP? And How Is It Better Than CVV?
OTP stands for One-Time Password. It is generally a 6-digit or 4-digit authentication code that is generated every time you try to make a transaction online. It is sent to your mobile phone as a text message and you need to enter it in the OTP field to complete the transaction.
It can be used only once and is valid only for a limited period of time. So it becomes invalid after a certain time and cannot be misused.
Also, the OTP is sent only to the registered mobile number of the credit card holder, so unless your phone is lost or stolen, there is very little chance for someone to misuse the OTP authentication.
Can Scamsters By-Pass The OTP Protection Layer Too?
We have to agree; scamsters are pretty smart. When the OTP security layer was introduced, they started calling vulnerable users and pretending to be from the credit card companies. They would assure the users that they are just verifying their account and will be sending them an OTP to verify their identity. They would then ask the users to give them the OTP. Many users believed this and used to share the OTP sent to their mobile phones, only to realize that the money from their account was being swindled instantly.
Banks and credit card companies constantly send reminders, messages, and emails to let customers know about such scams and never to share your OTP or CVV with anyone, even if they say they are from the bank. These warnings are especially important during the holiday season when people are more likely to fall for scammer’s tricks. It is important to remember that if you receive a message from a bank or credit card company asking for your CVV number, do not provide it. Instead, contact the company directly.
To Summarize -
While CVV offers an additional layer of security, it is not foolproof. Scamsters were able to break this authentication method very easily. CVV numbers are easily acquired by scammers by stealing personal information or by convincing customers to share their code. OTP offers better security as it is sent only to the registered mobile number of the credit card holder and is not easily compromised.