Why do you need to provide your credit card's expiration date in order to make a purchases?
This question is similar in spirit to Why do some online stores not ask for the 3-digit code on the back of my credit card?.
I don’t see how asking for the credit card’s expiration date as well as the number can possibly provide any extra security. As far as I know, the number and the expiration date are always given together when making online or telephone purchases by credit card, so I can’t imagine any even vaguely realistic scenario in which a thief could get the number without also getting the expiration date. Unlike with the security code, you don’t even need to turn the credit card around to get the expiration date, and are no rules against storing the expiration date along with the number.
If the point is just to increase the possible number of data combinations in order to prevent brute-force guessing, then it would be far more efficient to just make the number two digits longer. (Since credit cards usually expire 3-5 years after being issued, the expiration month only multiples the number of combinations by 36-60, whereas two extra digits would multiply by 100). That would also make the data format more consistent, simplify the data entry and storage.
tldr; There is a potential security benefit to expiration dates (vs longer numbers), but the main reason they exist is probably just leftover from when they were actually needed.
First, here’s a security benefit an expiration date has beyond just making it harder to guess:
Imagine that someone is trying to brute force CC numbers. If they didn’t need to provide an expiration date they would keep trying different numbers until they hit one that works. From the bank’s (or processor) point of view, they only see successful transactions, or invalid account attempts. For those that are invalid there is nothing they can do.
Now consider that the would-be theif is trying account numbers with an expiration date: once they have an account number, they must loop through all the possible expiration dates for that account. Now when the bank (or processor) detects invalid account attempts due to incorrect expiration dates, they now know this account has potentially been compromised, and can keep an eye on it. This makes the fraud-detection algorithms much more effective.
Security benefits aside, it’s likely that expiration dates made a lot more sense back in the days when transactions weren’t approved or denied immediately; they were carbon copied with a swipe machine and processed sometime in the future. Back then the cashiers actually had to look at the expiration date and make sure the card was still valid before accepting it as payment. Even if expiration dates aren’t actually needed anymore, there are enough minor benefits besides security to keep them around, such as giving banks a reason to send you a new card with an updated look and feel, or additional technology embedded (chip), or even just to force you to notify the bank of your current address so you can receive the new card.
Expiration dates were never intended at all to provide any extra security. You’re working with a flawed premise. A lot of infrastructure was put in place before the advent of instant account verification. At this point (Visa cleared $8,200,000,000,000 of transactions in 2016) changing the data collection practices of the entire system is no small task, no matter how redundant or unnecessary you feel it is.
Expiration dates are about limiting the issuing bank’s risk. Collecting and/or recording the expiration date is about limiting or removing the liability on the transaction at the verious steps between charge and payment to the vendor in the case of a chargeback. Vendors are under contract not to accept payment from or even attempt to charge a card that has expired and, in the case of stored card data, should not charge account information that has expired. Even if expired account information should fail if an authorization is attempted. And even though present day credit account renewals involve little more than reissuing a card with a new expiration date.
Not every piece of credit card data is as about fraud prevention, though there are tangential anti-fraud uses like reaffirming the expiration date or last 4 of the card number to help ensure the mag strip data matches the physical card info. To reiterate, expiration dates have absolutely nothing to do with security and everything to do with liability.
It actually is an extra level of security, exactly as you described. It’s not a lot, but it is an extra data point that can be checked against. Someone stealing a card number now has to steal the expiration date data as well, which isn’t always the case and not all retailers store expiration data, they simply use it as a checksum.
The expiration date itself serves a few purposes, but primarily as a way for CC issuers to ensure your card is physically operational longer. Mag stripes and lamination wear down after a few years, so having the card expire triggers a new card being sent to you. If you don’t destroy that card, and someone else finds/steals it, they won’t have the new expiration date to use for the validation process.
Adding more digits to the card numbers is not a simple feat. There is, however, a movement from some of the major companies to start using up to 19 digits on a credit card. (Note that 19 digit cards have existed for a while, but are relatively rare). Even still, longer card numbers really aren’t any more secure. Thieves steal the whole card number and it’s not just a random generator (although that does exist as well). It’s just as easy to steal a 19 digit number as it is a 16 digit number. The expiration date is still a point for validation, regardless of card number length.
Depending on the agreement between the vendor (the store you’re purchasing from) and the payment processor, they may be required to gather expiration, CVV, and zip code. For card not present, they may even require mailing address. All of these combine to add even more layers of security, or really, risk reduction. The vendors will pay different per transaction fees based on how much, or little, information they collect.
At the end of the day, there are tons of things the industry could do to decrease risk, but the factors that come into play are largely, if not entirely, logistical.