Merchant Features - AVS Verification

When you manually enter a sale into the terminal or your PC software program it will prompt for the customer's address and zip code.   You will key enter the street number (example - 456 if the address is 456 Henry Street and then the five or nine digit zip code).  The terminal will dial out for an approval and the zip code and numeric billing address will be compared with the physical address to which a cardholders MasterCard or Visa is registered.  Once this information is verified, the merchant will receive a response to the AVS request as to the validity of the address.  The AVS code will be displayed on your terminal display screen and an AVS code or message indicator will also appear on the customer's receipt if you have an electronic printer attached to your terminal.

The transaction may be approved even if the AVS information does not match!  The merchant will need to check all AVS responses to find out if the address is good.  THE TRANSACTION WILL NOT BE DECLINED BECAUSE THE AVS INFORMATION DOES NOT MATCH.  The merchant will NOT be penalized if any of the AVS information is incorrect.  The merchant does face a greater chance of chargebacks if he decides to accept the sale on a questionable match.

AVS is designed to give the merchant additional information to raise the comfort level of the merchant prior to shipping product when taking credit card orders over the phone or through the mail.  It is used as extra protection when accepting a purchase in person when the magnetic stripe of the card is unreadable.  Merchants who do not perform Address Verification are charged a higher discount rate on those particular transactions and will see it broken out separately on their merchant statement.  All processors charge more for manually keyed transactions without AVS.

It is very important to remember that whenever you swipe a card through the terminal and the magnetic stripe is unreadable that you MUST manually imprint the customer's card with a manual imprinter (aka knucklebuster !) and have the customer sign the manual sales draft, otherwise you automatically lose your chargeback rights if there is a customer dispute or retrieval request.  The only exception is for lodging transactions and in this case a signature on the guest registration card is usually sufficient.