Fraud Prevention: AVS and CV2
The banking industry introduced AVS and CV2 a few years ago to help combat the growing problems with verifying the cardholder during a CNP transaction.
Address Verification Service (AVS): This allows you to check the numerics in the cardholder's billing address with their card issuer. A successful AVS result shows that the person ordering knows the cardholder's address. This is a good indication that they are the true cardholder.
Card Verification Value (CV2): This allows you to check the additional 3 or 4 digit security code found on the signature strip on the back of the card. American Express cards have a 4 digit security code found on the front of the card just above the card number. A successful CV2 result indicates that the person ordering is in possession of the card at the time of the transaction.
Advantages of AVS and CV2:
- AVS and CV2 do not prevent transaction processing: No transactions are rejected on the basis of their AVS and CV2 results (unless you have a rule base set up). This means that you can make your own business decision whether to accept or reject each transaction
- Quick Results: AVS and CV2 are carried out in real-time, so you receive the results at the same time as the authorisation results
- AVS and CV2 provide more information about the transaction: AVS and CV2 provide you with more information about the transaction so that you can quickly decide whether or not you need to carry out any further fraud screening checks
- Failed AVS and CV2 are early fraud indicators: A failed or partially failed AVS and CV2 result is an early indication that the order may be fraudulent which can save you from carrying out longer manual checks
- Three-tier responses limit errors: Protx breakdown the results of AVS and CV2 into three catagories to cut down on the number of failed results due to customer error
- Rule base automates fraud screening: You can set up a rule base on your Protx account to automatically accept or reject transactions based on the results of the AVS and CV2 results to save you from manually checking the results on every transaction
- Provided to you on your Protx account free of charge: Protx provides AVS and CV2 automatically on all accounts free of charge
Limitations of AVS and CV2:
- AVS is a UK scheme only: It is not possible to check AVS on overseas orders, so you should expect your overseas orders to return with a 'CV2 Match Only' result.
- Only the numerics of the AVS are checked: The characters in the billing address are not checked as part of the AVS checks. This means that it is possible to receive a false negative result if a customer enters a flat number or house number that they have not registered with their bank.
- CV2 can be checked on all cards issued within the EU: CV2 cannot be checked outside of the EU.
Protx recommends that AVS and CV2 are carried out on all transactions. Due to the limitations listed above, it is a good idea not to rely on them solely, but rather to use the results as part of your overall fraud screening process.
If you would like further information about AVS and CV2, the different responses sent to you by Protx and how to set up rules bases on your account please click here for our fraud screening guide, or visit our support website.
