Have you ever wondered what all those numbers you can never remember written on your credit card really mean? We use our maps daily but most of us have little understanding of the story and the purposes they represent.
How to read your credit card number
This long number on the front of your card contains crucial information. The order of the digits is not random but strategically organized, following an international standard.
From this sequence, you can find out the issuing bank, your account number and more. Most importantly, the technology behind the number helps prevent fraud, minimize payment hassles, and reduce errors.
How? It all goes back to when the credit card industry struggled to attract customers.
The Three Major Credit Card Networks: A Brief History
A credit card is more than just a rectangular sheet of plastic and metal. Everything adheres to a strict standard. Yes, even the form and substance of the card itself. A credit card is a powerful tool issued by a financial institution such as a bank or credit union that allows you to borrow funds.
Financial institutions use a third-party company called the Credit Card Network to facilitate communication between the payment terminal and the issuing bank. Electronic transfers are thus faster. There are three major credit card networks that dominate the Indian market, Visa, Mastercard and RuPay.
The first and largest network was originally called “BankAmericard”. Created in 1958 by Bank of America with the aim of offering a credit product aimed at consumers rather than businesses, the card was initially unsuccessful. But by the mid-1960s it had recovered, amassing large profits. By 1974 BankAmericard had expanded into international markets and by 1976 it became known as “Visa Inc.” Smaller banks responded to Bank of America’s trial balloon by embracing the concept.
Mastercard, known at the time as “Interbank”, appeared in 1966. By 1968, the company had gone global. In 1979, the card changed its name to Mastercard. It is now the second largest card network in the world.
RuPay is an Indian multinational financial services and payment services system launched in 2012 by the National Payment Corporation of India. The Reserve Bank of India launched RuPay with the aim of establishing a national, international and open payment system. RuPay emphasizes “rupee” and “payment” launched by our country for card payments.
It is a widely accepted card at ATMs, point-of-sale terminals and online transactions. The security system is amazing, as it has a built-in chip that provides additional security against fake cards and also protection against phishing.
Each of these networks had one goal: to meet the consumer’s need for immediate access to funds without having to rely on cash. Modern credit cards represent a complex and highly refined history, much of which is aimed at protecting consumers against fraud.
front of a credit card
On the front of your credit card, you will usually see:
- The brand image of the bank
- A unique card number
- The name of the card holder
- An expiration date
- A smart chip
- The payment network logo
The structure of the card number
Although it may seem random, the credit card numbers are each strategically placed and represent vital information. Accurate transactions would not be possible without the specific sequence of digits, precise shape and exact size, all of which adhere to strict standards dictated by ISO (International Organization for Standardization) and enforced by ANSI (American Network of Standards Institute).
These standards allow cards to be used worldwide. Visa, Mastercard and RuPay all have a 16-digit format.
The first six digits
The first six digits of the credit card represent the Issuer Identification Number (IIN), also known as the Bank Identification Number (BIN). These numbers clearly identify the card-issuing financial institution. The first digit is the Major Industry Identifier (MII) and is assigned by the American Banking Association. Each major credit card network has its own IRM:
- Visa cards start with the number 4.
- Mastercards start with the number 5.
- RuPay starts with the number 6
The next five digits of the IIN represent the specific issuing bank. These numbers facilitate the exchange of information for the clearing of a transaction. The IIN range for each of the three major networks:
- Visa has an INN range of 4.
- Mastercard at 2221-2720 or 51-55.
- RuPay has a range of 60, 6521, 6522.
The account number
After the first six IIN digits is the account number. This sequence can be up to 12 digits but is normally 6. Issuing banks assign this number to their individual customers. Each issuing bank has approximately one trillion potential account numbers.
The check digit
Credit card issuers and networks use mathematical tools to combat data breaches and other fraudulent activities. Luhn’s Algorithm or Modulus 10 is one such device. Developed in the 1960s, it uses identifying numbers such as social security and credit card numbers to determine validity.
Credit cards are meant to be used instantly for payments. This is why the validation process used by banks must immediately encrypt and decrypt sensitive data. This is where Luhn’s algorithm comes in. Thanks to it, card numbers can be easily checked and their validity confirmed.
Luhn’s algorithm is simple to use. When you add the check number to the rest of the digits of the card, the sum must be equal to 0. If you enter a wrong number during an online purchase, it will be immediately detected, since the sum will not be equal to 0.
Visa uses the digit 13 as the checksum in most cases, while other major networks use the last digit.
Back of a credit card
Now that we understand what’s on the front of a credit card, it’s time to look at the back. Here you will usually find:
- A security code (CVV)
- A magnetic tape
- A hologram
- Bank details and customer service phone line
- A signed box
- The card network logo
Some credit cards also have the expiration date on the back.
Other card numbers: CVV and expiration date
The Card Verification Value (CVV) is a series of three or four numbers usually found on the back of the credit card. It represents another validation process and thus adds a level of protection. Some credit card issuers call it the Card Verification Code (CVC). Its purpose is the same regardless of its name.
By asking for this small but important additional piece of information, a point-of-sale (POS) system provides more assurance that the account holder is in possession of the card and the number hasn’t been stolen.
An expiration date is assigned to the card by the issuing bank and can also help with security by requiring another verification step. A card number may have been stolen, but without the expiration date that number becomes almost worthless.
Smart card technology and magnetic stripes
All these numbers – the PAN, CVV/CVC and expiry date – are stored in the magnetic stripe and in the Europay, Mastercard and Visa (EMV) chip.
Also known as the magnetic stripe, the magnetic stripe is located on the back of the card and transmits card data at the point of sale. The transmitted data is static. In other words, the information is loaded into the tape and remains unchanged.
Although the cards still contain a magnetic stripe, most of them now also use EMV or chip card technology. This microprocessor is placed at the front of the card where it also transmits data to the point of sale. Unlike static magnetic tape, EMV uses a dynamic transmission medium.
How it works? Each time you use the card, the transaction generates a different single-use code. This process makes EMV technology much more secure against card fraud such as skimming and counterfeiting.
And you guessed it, everything about magnetic stripe and EMV chips is standardized by ISO.
Credit card numbers and account numbers
Many people believe that the credit card number is the same as their account number. It’s wrong. But the two are linked and your account number will usually appear on your credit card statement.
If you need to replace your credit card, whether it was stolen, lost or damaged, you will receive a new card number, but your account number will remain the same.
Customer service phone line
Customer service phone numbers are not required to make purchases and do not play a role in protecting your card against fraud per se. But it’s still the best way to get in touch with someone at your bank when you need them.
For example, many fraud attempts are made over the phone or by email. The fastest way to check if a call or message is legitimate is to call the number on the back of your card. You will speak to someone at your bank who can tell if any messages have been sent to you.
Write down this number and keep it separate from your card so that if you lose your card you can call quickly to block the card immediately so no one else can use it.
Hologram security feature
Holograms are difficult to tamper with, which is why they can be an excellent security feature. This small mirror-shaped patch shows a three-dimensional image. If you look closely, you’ll notice that the image moves as you change the viewing angle.
How to protect your credit card number
The sad truth is that credit card numbers are stolen all the time. The best thing you can do to avoid this is to exercise caution every time you make a purchase.
When shopping online, pay close attention to the platform. If possible, use services like Paytm that keep your credit card number safe. If not, verify the company, make sure the website is secure and uses an SSL certificate.
Also keep an eye out for phishing emails. If anything looks suspicious, do not click on any links or download any attachments. Check the sender or call your bank.
Finally, don’t forget to make sure your computer is protected against malware and spyware.
The introduction of the credit card network and years of perfecting transaction methods led to the features of the credit cards we use today. Your credit card is full of important information and although the process behind it can be complicated, it simplifies your life and the way you make your payments.