Address Verification Service

Address Verification Service (AVS) is a security measure employed to prevent credit card fraud by verifying the billing address provided by a customer against the address records held by the credit card issuer. This system is crucial for transactions where the card is not physically presented, such as in online purchases, mail orders, or telephone orders.

When a customer makes a payment, AVS checks the numeric elements of the billing address—typically the street number and ZIP code—against the issuer's records. This verification process occurs in real-time, providing immediate feedback to the merchant about the accuracy of the address match. This feedback helps merchants assess the risk of the transaction and decide whether to accept or decline the payment.

Although AVS is primarily effective in the United States and only for U.S.-issued credit cards, it serves as a fundamental tool in reducing the risk of fraudulent transactions. By ensuring the person making the payment is likely the actual cardholder, AVS aids merchants in mitigating potential losses due to fraud. While it is not foolproof—cardholders may neglect to update their addresses with their banks, for instance—it significantly screens out a large proportion of potential fraud, enhancing transaction security for both merchants and consumers.