card-not-present transaction (CNP)

In Germany, a card-not-present transaction is referred to as a distance payment. In this type of payment, where the customer is not present at the point of sale( POS), the credit card is not presented and consequently not swiped by the card reader.

With the Card-not-Present Transaction, the customer merely communicates his card data - card number, card term, CSC code- by telephone or via online entries. Card-not-present transactions are predominantly used in online shopping and teleshopping, and unfortunately are also used for credit card fraud.

To prevent credit card fraud, the credit card industry has developed various security procedures. These include the Address Verification System( AVS), which verifies the address of the credit card user, and the Card Security Code (CSC), with an additional multi- digit number to ensure the authenticity of the owner.