Which method is commonly used to validate customer identity in e-commerce?

Utilizing CVC (Card Verification Code) and postal codes is a well-established method for validating customer identity in e-commerce. This approach relies on verifying information that is typically associated with the payment method used by the customer. When a customer enters their credit card information, they usually provide the card number, expiration date, and CVC. In addition, many merchants request the billing address, which includes the postal code, to ensure it matches the information on file with the card issuer.

This combination of data helps to confirm that the person making the transaction is indeed the legitimate cardholder. Since the CVC is not stored by merchants for security reasons, it adds another layer of verification beyond just the card number, making it more difficult for fraudsters to complete transactions without access to the physical card.

In summary, employing CVC and postal codes enhances security by ensuring that the entered payment information corresponds with what the bank has on record, effectively validating customer identity during online transactions.