What is the purpose of a Card Validation Code 2 (CVC2)?

The Card Validation Code 2 (CVC2) serves as a security feature embedded in payment card systems to help validate the cardholder's identity during a transaction. Specifically, the CVC2 is a unique 3-digit number printed on the back of a credit or debit card, separate from the card number. This code is used to confirm that the card is indeed in the possession of the cardholder when making a card-not-present transaction, such as those conducted online or over the phone. By requiring this code at the point of sale, merchants can reduce the risk of fraud associated with stolen card information, as the possession of the physical card is necessary to provide the CVC2.

In addition, the other choices focus on different aspects of card transactions but do not specifically pertain to the purpose of the CVC2. While check values, cryptographic processes, spending monitoring, and interchange fee calculations are relevant to the broader payments landscape, they do not accurately define the role or function of the CVC2 in enhancing transaction security.