Address Verification Service (AVS): Definition, Uses, and Example

The Address Verification Service (AVS) is a tool provided by credit card processors and issuing banks to merchants in order to detect suspicious credit card transactions and prevent credit card fraud. The AVS checks the billing address submitted by the card user with the cardholder's billing address on record at the issuing bank.

Key Takeaways

  • The Address Verification Service (AVS) is a tool that enables merchants to detect suspicious activity.
  • AVS verifies that the billing address entered by the customer is the same as the one associated with the cardholder’s account.
  • AVS response codes are returned to the merchant during the authorization process.
  • The merchant determines whether to approve or decline the transaction.
  • Other fraud detection methods include CVV validation codes, IP address verification, biometric analysis, and device authentication.

What Is the Address Verification Service (AVS)?

The Address Verification Service (AVS) is a fraud prevention system that can help to limit fraud and charge-backs. AVS verifies that the billing address entered by the customer is the same as the one associated with the cardholder’s credit card account.

The address confirmation is conducted as part of the merchant's request for authorization of the credit card transaction. The credit card processor sends a response code back to the merchant indicating the degree of address matching, thereby authenticating ownership of a credit or debit card in a non-face-to-face transaction. This process helps the merchant determine whether a card transaction should be accepted or rejected.

AVS is widely used by the major credit card companies to stop card-not-present (CNP) fraud. However, it is not a foolproof system. The billing address provided by a legitimate customer may not always match the address on record at the card issuer. For example, an address may not match if the cardholder recently moved or an address on record was incorrect. In such cases, the merchant runs the risk of rejecting a legitimate transaction.

AVS is an important part of the credit card authentication process and applies to cardholder addresses from the U.S., Canada, and the U.K.

How the Address Verification Service (AVS) Works

During the checkout process, a customer enters their address, which is then compared to the address on file with the issuing bank. Once the addresses are compared, the issuing bank returns an AVS code to the merchant. Merchants can use this AVS code as a guide to determine how to proceed with the transaction.

AVS response codes are single-letter codes that are returned to the merchant during the authorization process through their processing platform. These codes help determine the next action, which could be approving or declining the transaction.

Typically, AVS authentication is used as part of a multilayered fraud protection system to ensure that valid transactions are approved and suspicious ones are declined.

Example of Address Verification Service (AVS)

Imagine a customer is shopping online at When the customer enters their billing address during checkout, the following happens:

  1. Amazon's payment gateway transmits this address data to the customer’s credit card brand (e.g., Visa, MasterCard, Discover, or American Express).
  2. The credit card brand then sends this information to the issuing bank. The issuer compares the address with the address stored on file.
  3. The issuer then sends an authorization status and associated AVS response code to Amazon's payment gateway.

If the address provided by the customer does not match the address the issuer has on file for that customer, the AVS code will indicate the mismatch between the two addresses and the transaction may be declined. If the two addresses match, the AVS response code will indicate this and the transaction will likely be authorized. The AVS process generally only takes a few seconds and is invisible to customers.

Special Considerations

AVS does not a guaranteed fraud prevention. The system can on rare occasions generate false declines or partial declines. A partial decline may require the merchant to then use additional validation methods before completing the transaction.

A payment gateway or other payment solution should be use other fraud detection mechanisms as well. Other systems to detect fraud may include CVV validation codes, IP address verification, 3D Secure, biometric analysis, and device authentication.

How Long Does it Take to Verify a Credit Card?

Depending on the verification service the merchant uses, a credit card verification can take several minutes or just a few seconds.

What Is a CVV Number?

A CVV number, or card verification value, is a three-digit number printed on the back of a credit card, usually in the signature panel. It is commonly used to verify the cardholder physically has the credit card when they are making online purchases. It is also known as a card security code (CSC) or validation code.

How Can I Protect My Credit Card Theft?

You can take several steps to protect your credit card from thieves. First, you can avoid sharing your credit card information with others. If your credit card company provides account alerts, turn them on so you will be notified of suspicious activity.

The Bottom Line

Address verification is one way banks and merchants can reduce the likelihood of fraud. You can take steps to further protect your credit card information by creating secure passwords and avoiding sharing your credit card information. You can also regularly monitor your credit card activity for signs of fraud, including by regularly checking your credit report.

Article Sources
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  1. Chase Bank. "AVS Response Codes."

  2. Experian. "Credit Card Verification."

  3. CapitalOne. "What's a CVV Number?"

  4. Chase. "Credit Card Security."