Card verification numbers, known as CVV, CVV2, CID, CVC, are printed 3 or 4 digit numbers on credit cards that are not encoded in the magnetic strip on the back of the card. Card verification numbers are used to help prevent businesses from processing a fraudulent transaction. By creating a number that is not contained in the magnetic strip, a consumer must have the specific credit card on their person to be able to read the numbers. Visa, MasterCard, and Discover have a 3 digit number printed on the back of the card while American Express has a 4 digit number printed on the front of the card. Each card issuer has a different name for the verification number, but ‘card verification number’ is a generally accepted term.

Is it OK to give out my Card Verification Number?
You should never need to give out your number if you are at the place you are making a purchase. If you are buying something over the phone or on the internet, then it is acceptable to give out your number if asked. Make sure you are shopping with a reputable business before you give out your credit card or card verification number. Also, your card verification number is not your PIN (Personal Identification Number) used for debit card transactions. Do not ever give out your PIN to anyone.

Card verification for merchants:
Online and phone order businesses should require a card verification number for every transaction processed in order to help prevent fraud. By requiring the card verification number, you are ensuring that your customer actually possesses the card they are paying with, protecting yourself from fraud and costly chargeback expenses. You are also protecting any consumer that may have had their credit card number stolen. You are protecting your business and consumers from credit card fraud. Most processors actually require that all internet transactions use the card verification systems with every transaction. There is no extra cost for processing using card verification, so there really isn’t any reason not to use it.

To accept credit cards on your website you will need a merchant account. Before you ever go to apply for a merchant account for your website, make sure your site will meet the requirements to setup a merchant account.

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Having a secure website is one of the most important aspects of owning an ecommerce website. A secure website allows your customers to enter and transmit their information over the internet securely. The misconception that most people have, is that a secure (SSL) connection is all that is needed to secure a website.

The problem with securing a website, is that there are several aspects that need to be secure for the website to truly be secure. Unfortunately the aspect that is easiest to secure is by far the least vulnerable to loosing sensitive information.

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Many business owners that I talk to appear to be interested in bundled processing rates. A great deal less are interested after finding out exactly what a bundled rate is, and isn’t. Bundled rates can be great for some business and terrible for others.

What is a bundled processing rate?
A bundled rate is simply a combination of the credit card processing fee, and the transaction fee into a single flat percentage rate. The reason that a bundled rate seems appealing is that is simplifies the whole transaction process, at least a far as looking at it on a statement is concerned. The reason that bundled rates are bad for merchants, is that they stand to spend a lot more money on their credit card processing with a bundled rate compared to a standard rate.

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Ebay’s purchase of VeriSign unit seen as good move – Consumer Services – Technology, Software

The purchase of Verisign by Paypal could be considered one of the most significant acquisitions in credit card processing history.

Merchants sue Visa, MasterCard over fees

SEP. 26 1:34 P.M. ET Four merchant associations on Monday filed an antitrust, class-action lawsuit against Visa USA Inc., MasterCard Inc. and a number of top U.S. banks for allegedly colluding to set credit card transaction fees at anticompetitive levels.

MasterCard and Visa already face a number of retailer lawsuits that claim fees paid on each transaction amount to price fixing, and are designed to stifle competition. Both credit-card associations — valued for their processing networks as much as their brand names — derive most of their profits from the fees.

For entrepreneurs that are new to the internet, all-in-one ecommerce solutions can seem like the perfect solution. But many times, an all-in-one solution is a recipe for an all-in-one failure. This post will consist of 4 parts, involving setting up a website online. First will be an introduction, second will cover setting up a website, third will help you understand accepting payments online, and fourth will cover marketing and SEO. Each day will have relevant resources for that day’s topics.

The internet has millions of websites and of these, thousands of them are selling products online. Of these online businesses, thousands of them use pre built, all-in-one ecommerce solutions. The problem with a pre-made solution is that no matter which company is providing it, they almost always look the same. Completely independent companies have the same cookie cutter look as everyone else. These systems make it hard to distinguish yourself from everyone else.

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Often businesses run into the problem of being labeled as a high risk business for processing electronic payments and are forced into unconventional processing agreements. Many business owners have no idea that their industry falls into a high risk category.

Shades of Grey and Red:
High Risk businesses fall into either the gray area between a normal business and a definitive high risk business, or fall into the red zone for truly high risk businesses.

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Nearly every online business will run into a visitor that is trying to make fraudulent purchases on their website at some point. Hopefully the transaction or situation can be identified and corrected before it ever becomes a real problem.

Unfortunately, fraud has become synonymous with online business. There are so many ways that fraud can be committed through a website, with several desired outcomes for fraudsters. Not all fraudulent transactions are made to obtain merchandise. Card testing is another problem that some merchants face, where the transaction is not meant to obtain goods.

It is important for merchants to be able to identify fraudulent situations and purchases before there is ever a shipment of products. Voiding a transaction is far easier to do than obtaining merchandise lost to a fraudulent transaction.

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There are 2 options for a business when choosing to accept credit cards on the internet; a traditional merchant account, and 3rd party processing. 3rd party processors are companies like Paypal, 2Checkout.com, and Ikobo. Both, merchant service providers and 3rd party processors essentially provide the same service of enabling a business to accept credit cards.

The difference between the two business types is that third party processors process the transaction for your business under their own name, but with a merchant account, the transaction is processed under your businesses name. Visa and MasterCard both have strict policies against having another company process your transactions for you.

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