What is a Card Verification Value?

 

A Card Verification Value (CVV) or Card Verification Code (CVC) is a three- or four-digit security number on a credit card used to verify that the cardholder has the physical card during online or phone transactions, providing an extra layer of fraud protection. But card issuers have developed some pretty good defenses against these ne’er-do-well thieves. One of them is that little three- or four-digit number called a Card Verification Value (CVV) — or, as some call it, the Card Verification Code (CVC). It’s your job to keep that number secret.

How Card Verification Value Works in Card Transactions

The CVV/CVC was invented to put an extra lock on your credit card and keep fraudsters at bay. It’s a secret password to ensure the rightful card owner is using the card before any money changes hands.

Enhances Online Transaction Security 

That little CVV/CVC is like a guard dog, just watching over your credit card when you go to make purchases online. And even if some no-good thieves happen to get a hold of your card number, they won’t be getting very far without that magic code. These codes are a real fence against those sneaky outlaws who might get hold of your card number but don’t have their mitts on your card itself. Without the CVV, it’s like trying to get into the corral without the gate key — it just isn’t happening!

Verifies Card-Not-Present Transactions 

When you’re making an online or phone purchase of an item, the seller asks you for the card’s CVV. It helps keep fraudsters at bay with card-not-present (CNP) purchases where you don’t physically hand over your card. The setup keeps rustlers from making off with your goods should they steal your account number but not your CVV.

Where to Find the Card Verification Value on Your Cards

It’s mighty important to know where the CVV or CVC is hiding on your card because it’s the key to keeping no-good varmints from riding off with your money. Different cards stash it in different spots, so if you’re looking to protect your funds, you’d best know where to find it.

• CVV on Visa, Mastercard, and Discover: You’ll usually find the CVV on the back of Visa, Mastercard, and Discover cards next to the signature panel. It’s a three-digit number that stands off by itself, separate from the main card number, silent but deadly against would-be hackers and fraudsters. It may be only a tiny number, but it is like the lock on a cattle gate — without it, the rustlers can’t make off with your wealth. If you aren’t paying attention to it, you might as well leave your safe wide open!

• CVV for American Express Cards: Things are a little different if you’re using an American Express card. The CVV — or,  in this case, CVV — sits on the card’s front, a four-digit number above the card number. It’s about as hard to miss as a coyote in a henhouse, and Amex likes to make sure you can find it without breaking a sweat. So, it’s a little more prominent compared to other cards. It’s as if Amex is waving a flag, saying, “Here I am!” With Amex, you look at the card front to get the code you need.

• Differences in CVV/CVC Formats: The length and placement of CVV/CVC codes depend on the card issuer. Some cards, such as Visa, Discover, and Mastercard, use only three digits, while Amex goes the extra mile with four. 

Some cards, such as virtual ones, do not even physically display a CVV. Instead, each transaction is accorded a new number. Source

11 Credit Card Habits You Need to Break Now

Taking control of how you use your credit card is the first step in getting out of debt. Here’s a look at 11 credit card habits you need to break immediately to start taking control of your finances.

1. Carrying a Revolving Balance

Carrying a revolving balance on your credit card makes each purchase you make more expensive thanks to interest fees. As your balance grows, interest charges accumulate, taking a big bite out of each payment you make to your account. Paying any amount of interest on your credit card account also voids any rewards you earn since the interest rate is calculated at a much higher rate than the rate at which you may earn cash back, points, or miles for your purchases.

Break this habit by treating your credit card like a debit card and only charging what you can afford to pay off in full at the time you charge it. It’s also a good idea to check in on balances once a month so you know when it’s time to scale back on spending.

2. Relying on Credit to Make Ends Meet

A recent LendingTree survey found that 64% of Americans are living paycheck-to-paycheck and many of them are relying on credit cards to make ends meet. While using credit cards to pay bills and afford other monthly expenses may seem like your only option when there’s no money left in the bank, setting up a budget can help get your finances back on track. 

Begin by creating a detailed spending plan that accounts for saving and paying down debt. Scrutinize bills for potential savings, start meal planning to reduce grocery spending, and track each purchase to ensure your dollars are going exactly where they need to so you can stay on budget. Tap into budgeting apps like YNAB or PocketGuard for help organizing your expenses and use services like Trim to identify and cancel unused services.

3. Keeping High Balances

Pushing your credit limits can cost you in the form of a poor credit score. Although the 2009 Card Act prevents credit card issuers from allowing accounts to go over their set limit so you don’t get charged an over-the-limit fee, there are other negative consequences that come with carrying a high balance such as dinging your credit score. In fact, credit utilization rate refers to how much available credit you have versus how much debt you owe. Your total indebtedness accounts for 30% of your credit score points.

In general, it’s advised that you use no more than 30% of your available credit to maintain a good credit rating. Using any more than that will impact your score for the worse and make it harder to secure a loan to buy a house or car.

4. Paying Just the Minimum Payment

Paying just the minimum due each month will trap you into a revolving cycle of debt that becomes increasingly difficult to pay off. As your balance grows and interest fees rise, you end up shelling out an incredible amount of money to pay down your original charges.

Say you’re carrying a credit card balance of $5,000 at the average interest rate of 20.74% and are only able to make a payment of $100 per month, it is estimated that it will take you 117 months (that’s almost 10 years!) to pay off the entire balance. That will cost you $6,650 in interest on top of your original purchase charges. That means you will have spent a total of $11,650 during this time.

5. Missing Payments

Pay close attention to when statement charges are due to avoid late payment fees and other potential penalties. Those who miss their payment due date will get slapped with a late payment fee of up to $41, and they will begin accruing interest on purchases charged during that billing cycle. Missing payments for 60 days or more will result in a penalty rate increase which will make your balances more difficult to pay off, leading to a vicious debt cycle. 

If you’re struggling to pay your credit card bill, don’t ignore it. Call your credit card issuer to set up a payment plan to avoid fees and penalties. Otherwise, setting up bill reminders and auto pay are easy ways to avoid these potential fees.

6. Using Multiple Credit Cards

The more credit cards you have, the easier it is to lose track of your total spending and rack up balances across multiple accounts, leading to devastating debt. It’s better to stick with one credit card so you can keep a watchful eye on spending to ensure you aren’t going over budget. This also allows you to maximize rewards to earn a greater amount of cash back, miles, or points on those daily purchases and monthly expenses.

7. Chasing Rewards

Spending more to earn rewards will cost you more in the long run compared to what you get back from the card issuer. Only use your credit card for purchases you carefully planned and use other tools to increase cash back or other reward earnings. 

8. Ignoring Bonus Reward Offers

Many reward credit cards offer bonus-earning potential each month for select retailers and businesses. These promotional offers allow you to rack up more cash back, miles, or points when making purchases with these companies, but you don’t automatically qualify for the extra perks. Such offers are usually emailed to you from your credit card company and require you to log into your account and opt-in to qualify for the extra rewards. Overlooking these promotional offers could mean you miss out on extra rewards to put toward a purchase or travel booking.

9. Swiping on Impulse

According to the Impulse Spending Report from Slickdeals, the average consumer spends just over $150 on impulse purchases each month. While $5 here and $10 there seems harmless, these small purchases quickly snowball and can cause you to take on a balance you cannot pay off by the due date. Tracking each purchase and following a carefully crafted budget is key to avoiding debt.

10. Opening Store Cards to Score a Discount

Retailers entice shoppers to open store credit cards by offering an immediate discount of 10 to 20% off their purchase if approved for an account. While the additional savings is tempting, opening a new credit card for a discount is ill-advised for a few reasons. 

First, your credit score may get dinged each time you request a new line of credit which will put a current loan request in jeopardy. Second, most store cards have low credit limits, high interest fees, and limited reward earning and redemption options, making them a poor choice for most shoppers. 

11. Ignoring Savings When Paying Down Debt

A common mistake people make when trying to get out of debt is to use all their available funds to pay down balances. However, ignoring the need to save at the same time can backfire and cause you to take on more debt down the road. While it’s important to work toward paying down high-interest debt, it’s even more important to build up savings in case of emergencies. 

An emergency fund protects your financial health by giving you a cash cushion that you can lean on during a tough financial time or when an unexpected bill pops up. Having access to liquid cash ensures you can pay bills rather than rely on a high-interest credit card and dig yourself back into a deeper debt hole. Aim to save up to three months of these living expenses in a separate account so it’s out of sight and out of mind. 

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Diversifying Customer Payment Method Options

Offering customers multiple ways to interact with your business is a heavy priority this year. Does your business support social distancing and flexible payment options?

Economic effects of the coronavirus pandemic have challenged the way we do business. Businesses and consumers are extra avoidant of handling cash and credit cards. Those who accept credit cards are taking extra precautions to make sure their credit card terminals are disinfected between checkouts and their customers have the option to bypass contact altogether when they buy something in person.

Already, contactless payments were experiencing a surge in popularity, but since the virus started impacting the U.S. banks have issued more contactless credit cads than ever before. According to a study in March conducted by RTi Research, about 30% of consumers in the U.S. have started using contactless payments since the virus started raising widespread concern, and of those new users, 70% expect to continue using contactless payments method when pandemic risks have lessened. Contactless payments include transactions made via contactless credit card, wearable NFC devices like smart watches, and smart phones.

Most EMV chip-enabled terminals are also capable of contactless transactions. Examples range from standalone terminals like the Verifone VX520 to full-featured POS systems like the Clover Station.

Also according to RTi Research, approximately 30% of consumers worry about catching the virus from cash, heavily under fire as a virus transmitter. If your credit card terminal does not already accept contactless payments, it may be time for an upgrade through your merchant services provider. Don’t miss payments just because you don’t offer your customer’s preferred payment method.  

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Point Of Sale for Retail

Bankcard Processors has everything you need to run your retail business. It’s quick, efficient and intuitive to use. Sell products by the pound, inch, yard, ounce, etc., and designate the price accordingly at the register. Integrates with all of the peripherals you’ll need including scanners, scales, and printers.

Generate & Track Unique SKUs

Managing your inventory can be a challenge. That’s why our POS for Retail allows you to generate and track unique SKUs on your products.

Sell Online

With Online Ordering through Bankcard eCommerce, customers can place their orders online and for easy shipping or in-store pick up. Expanding your sales to the web will allow you to expand your customer base and increase sales.

Employee Sales Summary

If at the end of a shift you want to see a sales report from your associates our Backend Portal includes a comprehensive Employee Sales Summary Report. Compare employee sales to labor overhead and reward or promote your top earners with concrete data that reflects their merit.

Point Of Sale for Restaurants

Our feature-rich platform is a leading cloud-based POS system restaurants designed to make managing your business easier, so you can focus on why you opened your restaurant in the first place.

All Restaurants Created Equal

Our solution can adapt to any restaurant and hospitality use. The custom features and settings easily accommodate cafes, pizzerias, fine dining, bars, nightclubs, and more!

Streamline Operations

Increase the speed and accuracy of your restaurant. Our lightning quick and intuitive platform allows your staff to turn tables faster while operating error free.

Customer Experience

Provide a consistently great customer experience with smooth and efficient service. Never get the order wrong or keep your guests waiting again.

Who is Involved in Credit Card Processing?

The key participants involved in credit card processing include:

• Cardholder: The individual who receives a card from an issuing bank and uses the card to make payments. This individual can be either the card owner or an authorized user of the card.
• Issuing bank: The entity, also known as a card issuer, that underwrites and issues cards to individual and business cardholders who meet certain credit standards. The issuing bank maintains card accounts, bills and collects payments from cardholders and monitors the performance of credit card receivable portfolios.
• Merchant: A business that accepts cards as a method of payment. These payments can be made in person, online, or by mail order or telephone.
• Merchant bank: The entity, also known as an acquiring bank, that maintains the merchant’s account where deposits from credit card payments are accepted. Some merchant banks also provide merchants with credit card terminals, which may be purchased or leased.
• Payment processor: The entity that helps many merchants and merchant banks manage the daily settlement and information flows related to credit card activities.
• Issuer processor: The entity that provides a system for issuing banks to board accounts, provides authorizations and offers risk management tools to issuers to manage their card portfolios effectively.
• Card network: The organization, also known as a card association, that maintains infrastructure to support card transaction activities such as authorization, clearing and settlement. Examples of card networks include Visa, Mastercard, Discover and American Express.
• Payment gateway: The technology that provides the link between the point at which the credit card data is received by the merchant and the merchant bank. The payment gateway encrypts the data before sending it to the merchant bank and transmits both the authorization request to the issuing bank and the issuing bank’s response back to the merchant.

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How to Choose a Credit Card Processing Provider

When choosing a credit card processing provider, businesses should consider several factors to ensure they select the right partner for their needs:

Assess your business needs

Understand your transaction volume, average transaction size, and whether you require in-person, online, or mobile payment processing. Consider every market, audience segment, and channel where you currently do business or plan to expand. You’ll want a payment provider that accepts all the preferred payment methods and currencies in these areas.

Compare pricing and fees

Processing providers may charge various fees, including transaction fees, monthly fees, setup fees, and hardware fees. Compare different providers’ pricing structures to determine which one offers the best value for your business. 

Evaluate the provider’s customer support

Issues with your processing system can directly impact your sales and customer experience. Look for reviews from other businesses to gauge the provider’s reputation and reliability and consider asking for recommendations from your industry peers. Make sure you choose a provider that offers reliable customer support. 

Consider the provider’s security and compliance measures

Ensure that the provider complies with the Payment Card Industry Data Security Standard (PCI DSS) and other relevant security standards to protect your customers’ sensitive data and minimize the risk of fraud.

Review integration compatibility

Check if the provider’s payment-processing solution is compatible with your existing POS system, e-commerce platform, and accounting software, to ensure that integration is as seamless as possible and future operations run smoothly.

Analyze additional features and services

Some providers may offer value-added services, such as advanced reporting, recurring billing, or multi-currency processing. Determine which features are necessary for your business and which features would be a nice addition.

Carefully evaluating these factors and comparing different credit card processing providers is the best way for businesses to make an informed decision that suits their requirements, budget, and long-term goals.

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