Monday, May 23, 2022

What is a CVV Code, role of high risk merchant, and how accepting EBT helps?

Locating CVV code is simple. It appears on the debit card backside as a three-digit number. In some cards, it seems like four digit-numbers on the front.  They come in two parts:

  • The first part is a striped magnetic strip containing crucial data relating to the debit card. The information recovery is when there is a card swiping through the reader machine.
  • The second part has digits to enter on a telephonic or online transaction. It is the security number that is the CVV code working as the security in a debit card.

Why do you need CVV?

CVV is found in a debit card, and it works as a security guard to an establishment. It protects the debit card from fraud, theft, or unauthorized transactions. The CVV code ensures it is the card owner using the card.  If someone gets your debit card number stealthily, the transaction will stay incomplete without the CVV.

Your personal identification number of the card and the CVV is never the same. The PIN is to use with the card to make transactions in-person or at ATMs. The CVV is useful for making over-the-phone or online payments. It is useful for high-risk merchant services. Fortunately, the CVV does not save while online punching or swiping the card. The other details of the card are visible, but not the CVV. The CVV provides security for the users, and any debit card user should refrain from sharing the CVV code with others.


Who is a High-Risk Merchant Account?

A high-risk merchant account is assigned to merchants presenting a risk to some degree. It is associated with businesses. The high-risk merchant services are for specific reasons:

  • A merchant may have a flawed or imperfect credit history.
  • The merchant has high fraud rates or chargeback.
  •  The merchant presents concerns such as health risks, reputation, finances, etc.
  • The merchant processes transactions in high volume, usually domestic.

The banks are not ready to provide solutions to high-risk merchants, fearing they will outweigh the risk. Yet, there are merchant services ready to do business with high-risk account holders. High-risk merchant accounts come with challenges. There are high-risk industries designed to partner with affordable payment processing solutions.

Acquiring payment service providers and banks board high-risk merchants with caution asking for:

  • Tightening underwriting procedures and asking for additional KYC documents.
  • Imposing volume caps, mandatory chargeback prevention, or security presets on transactions.

Merchants that are high risk are aware that getting the right merchant account is not easy. The banks are not keen on providing payment processing. There are quality solutions, and the risk of e-Commerce is always changing. When a business receives the label of high risk from banks, it means:

  • The business is a startup with no or a few credit card processing facilities.
  • Subscription-based services or products, such as magazines or online dating.
  • High volume businesses, for instance, nutraceuticals
  • High cost for instance, the airline tickets or timeshares
  • Imperfect credit, flawed, bankruptcy history.
  • A merchant facing as bank terminated merchant account
  • A specific region or county targeting merchant
  • Industry tarnished by high returns or chargeback.

The industries receiving payment processing solutions as high-risk merchant services include:

  • Airline tickets, bitcoins, adult entertainment, cash advances, binary options, e-cigarettes, collection agencies, forex trading, debt consolidation, extended warranties, online dating, multilevel marketing, internet gambling, online casinos, loan services,  tech support, satellite TV repair, nutraceuticals, social gaming, penny auction, travel agencies, and timeshares.

What is EBT?

EBT represents Electronic Benefits Transfer technology. It plays a vital role in ensuring a healthy life as it is accessible and affordable for people in need. It is also easier for the merchants to sell goods. Tackling the challenges and accepting EBT payments helps improve the recipients.  It allows the EBT cardholders to shop conveniently and easily.

  • EBT card is a technology advancement that has eliminated the stamps and coupons that leads to lost coupons, stolen stamps, etc. The introduction of merchants helps EBT payment in their strategy.
  • The EBT merchant helps to broaden the participation. It allows the receivers of the EBT card to access more nutritious and healthier foods.
  • The EBT program reduces the barriers in adapting to this transaction as it promotes the health and well-being of the community.

Accepting EBT is possible for the retailers who receive approval from SNAP. The EBT also receives an FNS as the CVV code. It is a way of the government providing qualifying individuals and families financial assistance.

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