Differences Among Credit Card Companies

• While almost all credit cards include a CVV these days, all of the major credit card issuers have slightly different names and placements for the verification codes. Visa refers to it as a Card Verification Value version 2, or CVV2, and uses a three-digit code on the back of the card after the account number in the signature strip. MasterCard refers to it as a Card Validation Code version 2, or CVC2, and places it in a similar position as Visa. Discover refers to it as a Card Identification, or CID, and also places it at the end of the account number in the signature space. American Express does things slightly different however, using a four-digit Card Identification, or CID, and puts it on the front of the card above and to the right of the account number.
  
  

Benefits

• Credit cards now include these three-digit codes as a way to help merchants verify that the person making an online purchase is in possession of the credit card. Merchants benefit by having fewer fraudulent purchases and therefore fewer disputes with credit card companies and better profits.
  
  

Customers' Use of CVV

• Most online merchants will now require customers to enter their three- or four-digit CVV code when inputting their credit card information to make a purchase. A merchant can then use the CVV in its authorization process for the credit card. The card issuer validates the CVV as part of the card's authorization, and the merchant then uses that information as part of its decision-making process as to whether or not to approve the transaction.
  
  

Back-End CVV Processing

• Merchants should follow the process outlined by card issuers when taking purchase requests online or over the phone. When you submit a customer's credit card information for authorization, you must include a CVV presence indicator: zero if you chose not to ask for the CVV, 1 if you include the CVV, 2 if the customer claims the CVV is unreadable or 9 if the customer claimed the card did not have a CVV. The card issuer will then attempt to authorize the card and the CVV and will return a result code. Result codes include the following: M for good match, N for no match, potential fraud, P for re-submit the CVV, S for customer says no CVV but there should be one, or U for CVV not used on the card.