See Card Verification Value 2.

To help reduce fraud in the card-not-present environment, credit card companies have introduced a card code program. Visa calls this code Card Verification Value (CVV); MasterCard calls it Card Validation Code (CVC); Discover calls it Card ID (CID). The card code is a three- or four- digit security code that is printed on the back of cards. The number typically appears at the end of the signature panel. This program helps validate that a genuine card is being used during a transaction. To help combat fraud, card-not-present merchants should always enter a card code (if on the card) when processing an authorization. The Gateway will compare the card code against the code on file with the card-issuing bank. Results of this comparison will show in the transaction approval code. By using the card code results along with the Address Verification Service (AVS), you can make more informed decisions about whether to accept transactions.

Visa term for 3-digit code in signature panel to verify that the card is in the cardholder’s possession.