Address Verification Service

Address Verification Service (AVS) is a fraud prevention measure employed in credit card transactions to verify the authenticity of the billing address provided by a

cardholder

. During an online purchase, the AVS compares the numerical portion of the

billing address

entered by the customer with the address on file at the

issuing bank

. The AVS system assigns a code indicating the level of match between the entered address and the one on record. Merchants can use this information to assess the risk of a

fraudulent

transaction.

AVS can affect both conversion and

acceptance rate

. Strict AVS rules may block legitimate transactions due to minor mismatches, lowering approval rates and creating false declines. Merchants, therefore, need to balance fraud prevention with customer experience by configuring AVS handling carefully.

AVS was developed specifically to help merchants from the

MOTO

industry with transactions, but it has since become a key feature of all card-not-present fraud detection systems.

For customers in supported countries, AVS provides an extra layer of protection, effectively shielding them from low-sophistication attacks aimed at stealing and misusing their credit card information.
For merchants, the AVS response signal is a useful piece of information, which should be weighed into the risk scoring. As a result, merchants are better protected from
chargeback
requests.

Merchants often configure their payment systems to either decline transactions with AVS mismatches or use the information as one of several factors in their fraud prevention strategy.