What is Card Not Present (CNP)? Types, Fraud Risks & Security

What is a Card Not Present (CNP) Transaction?

A Card Not Present (CNP) transaction occurs when a credit or debit card is used for a payment without the card being physically presented to the merchant. Instead of swiping, tapping, or inserting the card, the cardholder provides payment details remotely—such as online, over the phone, or by mail.

CNP transactions are common in e-commerce, mobile payments, recurring billing, and telephone orders. Because the physical card isn’t verified at the point of sale, these transactions typically carry a higher risk of fraud, requiring stronger security measures.

Types of CNP Transactions

CNP transactions can occur through several remote channels, including:

• E-commerce Payments: Purchases made through websites or mobile apps using card details.
• MOTO Payments (Mail Order / Telephone Order): Customers provide card information over the phone or via mail.
• Recurring Billing: Subscriptions or services where card details are stored and used periodically.
• In-App Purchases: Payments made within a mobile application.
• Digital Wallets: Transactions through wallets like Apple Pay or Google Pay when the physical card is not used.

Platforms like Sycurio.Voice enable secure CNP payments in call centers by shielding sensitive card data during voice transactions, helping maintain PCI DSS compliance.

CNP vs Card Present Transactions

Understanding the difference between CNP and card present transactions is essential for managing risk and compliance:

Key Characteristics of CNP Transactions

• Remote Interaction: The cardholder and merchant are not in the same physical location.
• Data-Driven: Requires input of card details (number, expiration date, CVV).
• Authentication Reliant: Relies on digital methods for verification (e.g., 3D Secure, one-time passwords).
• Higher Risk Profile: Due to lack of face-to-face interaction and physical verification.
• Compliance-Intensive: Must meet strict standards like PCI DSS, especially in industries handling sensitive customer data.

CNP Fraud Risks and Security Measures

CNP transactions are more susceptible to fraud such as identity theft and stolen card use. To combat this, merchants and payment processors must implement robust security controls, including:

Common CNP Fraud Risks

• Phishing: Attackers trick users into giving away card details.
• Card Testing: Fraudsters test stolen cards with small transactions.
• Account Takeovers: Hackers gain access to customer accounts to use stored card data.

Security Measures

• Tokenization: Replaces card details with secure, non-sensitive tokens.
• End-to-End Encryption (E2EE): Encrypts data throughout the payment journey.
• PCI DSS Compliance: Mandates how cardholder data should be stored, processed, and transmitted.
• 3D Secure (e.g., Verified by Visa, Mastercard SecureCode): Adds an extra layer of verification during online checkouts.
• Voice Payment Security: For phone-based CNP transactions, tools like Sycurio.Voice allow secure, DTMF-masked data entry that keeps agents and systems out of PCI scope.

In summary, Card Not Present (CNP) transactions are essential in today’s digital commerce landscape—but they demand advanced security and compliance frameworks. With the right tools and practices, businesses can safely process CNP payments while protecting both customers and reputations.