Address Verification System

Address verification can drastically reduce fraud in the credit card industry if used effectively. AVS works by including two pieces of extra information in the transaction request sent to the card processor: the numeric portion of the cardholder's address, excluding apartment or suite number (req.addr) and the ZIP code (req.ZIP).

This information is compared by the card processor against database information for that customer; if all other factors (card number, expiration date of card, etc.) cause the transaction to be approved, a return code is transmitted to the hosting engine consisting of the letter Y, a six-digit authorization number, and an AVS code. AVS codes correspond to different degrees of match when the address and ZIP code information are compared against the database. (If the other factors cause the transaction to be declined, no AVS code is returned.)

If your connection to the card processor is through a dial-up connection, a single character AVS code is returned. These are the AVS codes that a merchant may see.


AVS CODE	DESCRIPTION
A	(Address) Address matches, 5-digit ZIP code does not match
E	(Edit Error) For example, address verification not allowed for this transaction
N	(No) Address does not match, ZIP code does not match
R	(Retry) The system was unavailable or timed out
U	(Unavailable) Address verification is not available
W	(Whole ZIP) Address matches, 9-digit ZIP code does not match
X	(Exact) Address matches, 9-digit ZIP code matches
Y	(Yes) Address matches, 5-digit ZIP code matches
Z	(ZIP) Address does not match, 5-digit ZIP code matches

AVS codes through lease-line connection

If your connection to the card processor is through a lease-line connection, a 3-digit AVS code is returned. These are the AVS codes that a merchant may see.


AVS CODE	DESCRIPTION
YYC	Address matches, ZIP code matches
YNC	Address matches, ZIP code does not match
YXC	Address matches, ZIP code comparison not available
NYC	Address does not match, ZIP code matches
XYC	Address comparison not available, ZIP code matches
NNC	Address comparison does not match, ZIP code does not match
NXC	Address does not match, ZIP code comparison not available
XNC	Address comparison not available, ZIP code does not match
XXC	Address comparisons not available, ZIP code comparison not available

How Critical is it for a merchant to perform AVS?

If a keyed merchant does not perform the AVS function at the time they are processing the keyed transaction, your merchant services provider or bankcard provider will consider the transaction non-qualified, whereby you, the merchant, will pay a much higher discount percentage for that keyed transaction. Performing the AVS function at the time you key in the transaction places that transaction in a mid-qualified range for your bankcard processor.