What is AVS (Address Verification System)?
The address verification system or AVS is an electronic system that verifies the address of the card holder during a credit card transaction. This system is commonly used in internet based and keyed in transactions where the card is not being swiped through a credit card machine. This system can verify the billing zip code of the card holder and if setup properly can verify the street address and sometimes even the telephone number. The merchant gets a response that the AVS is approved or declined and can then chose to run the transaction or not.
AVS should always be used for every internet and keyed transaction to avoid downgrade charges and fraud. Even if you can verify who your customer is, if you are setup as a keyed or internet account, you should use AVS for every transaction.