Online merchants often have an alternative to signing credit card transactions. There are currently two methods available: the AVS (Address verification System) and the CVV (Credit Validation Value). This article will cover each of these options and give you an opinion on which one is best.
AVS (Address Verification System) is a method that authenticates a credit card purchase using the billing address. The credit card bill should show the billing address. This method offers security protection as credit card fraud is often committed from overseas. The credit card user has the credit card number and nothing else. This method can also block legitimate purchases. People often misspell their address or change their address. Credit card information is not updated or propagated properly. Even worse, banks will place a 72-hour hold on transactions if there is an AVS error. This can be very frustrating for legitimate clients who have multiple AVS errors. It seems that not all transactions are authenticated against AVS. One transaction I witnessed had “123 Go Away” listed as the address, but it was authenticated.
The CVV (or Credit Verification Value) is a method to verify a credit card purchase based upon the 3-4 digit number on the back (VISA MasterCard, Discover, and Discover) or front (AMEX). This number is usually only accessible to the cardholder. Credit Card companies have strict guidelines against saving unicvv in merchant’s databases. CVVs have the advantage that they are a number. It’s printed on the credit card, so it is very easy for people to enter it. Also, the error margin is often low. The best part is that fraud is almost eliminated by CVV authentication. This is because it is very rare for fraudsters to have the CVV unless the credit card has been stolen and reported. However, the CVV has one drawback: some people may not know where it is located. However, most purchase forms now include a small image that shows where the CVV can be found. The policy of holding money in the event of a failed purchase also applies to transactions authenticated using the CVV. However, this is a much smaller issue than that of AVS because people make fewer mistakes writing 3-4 digit numbers than they do writing complete addresses.
Which is better? AVS or CVV? It’s clear that CVV is better than AVS. Ask for the address again, but don’t verify it. Always log the IP address of the transaction. If you have the US billing address and the IP address of the transaction originates from overseas, it is most likely a fraud.