What is AVS or Address Verification Service?
December 24, 2008
When you want to add another layer of security to your online business, you should consider adding AVS to your arsenal against fraud. AVS, or address verification service, allows you to verify the personal address and even the billing information of the customer that wants to make a purchase on your website. This allows you to see if who is shopping with you is really the person that they say they are.
The AVS system works by taking the credit card information that you have been given by the customer and then runs it against what the credit card company has listed for the cardholder. If the two do not match, the charge will be not go through and the cardholder will either need to type in the information again or the card can be taken from the person that is trying to use it.
AVS uses a list of response codes that will help you determine how accurate of information you have received from a customer and what you think is ‘enough’ to allow them to make a purchase. In this day of not being able to see your customers, this code system comes in handy.
X = exact match - address and nine digit zip code
Y = exact match - address and five digit zip code
A = address matches, but the zip code does not
W = nine-digit zip code matches, but the address does not
Z = five-digit zip code matches, but the address does not
N = address and zip code do not match
And then there are these other responses:
U = address information is unavailable at the time
R = retry the transaction - system is unavailable at this time
S = service is not available at this time
E = data not available/error invalid
What’s also great about this process is that the customer will never see that it is happening, even if they are right in front of you. If the information does not match up, the customer is told to re-enter their information or the transaction is denied. The customer can then try to correct the information or they will have to call you to place their order.
There are a number of reasons why you should consider using AVS or a merchant account with AVS:
- Reduce fraudulent charges – When you’re not accepting payments from those whose information does not match up, you can significantly cut down on transactions that are not legitimate.
- Reduce chargebacks – Because you will be verifying information with the customer, you can be sure that it’s the customer that is doing the ordering and really wanted to make the purchase.
- Create customer confidence – When you are verifying information, your customers will feel as though their information is safe and secure.
- Assists online business – Instead of having to track down the right shipping address, you will already know it.
With an AVS system, you can make sure that credit cards aren’t being used when they shouldn’t be used and that you are always getting the money that you desire for the purchases that have been made.
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