What is meant by truncation in relation to credit transactions?

In the context of credit transactions, truncation refers specifically to the practice of displaying only the last four digits of account numbers. This is an important security measure designed to protect sensitive information. By only revealing the last four digits, financial institutions and merchants can still identify accounts for customer service purposes without exposing full account details, which could lead to identity theft or fraud.

Truncation is a critical concept in compliance with laws and regulations, such as the Payment Card Industry Data Security Standard (PCI DSS), which seeks to safeguard consumers' personal and financial data. It minimizes risk by ensuring that full account numbers are not disclosed in receipts or other documents that may be viewed by unauthorized individuals.

In this context, options that mention hiding the card's expiration date, omitting the cardholder's name, or displaying only the billing address do not accurately reflect the definition of truncation as it pertains to credit transactions. These actions do not specifically relate to the practice of only showing part of an account number. Therefore, focusing on the last four digits directly aligns with the definition and objectives of truncation in financial and credit transactions.