| Ideally, your business would run smoothly as you | | | | cardholder's account with the address that a customer |
| process payments for your customers each day. | | | | provides online. In many cases, an offender will try to |
| Your customers would gain value by buying the items | | | | use his own mailing address while providing a stolen |
| they need (or want) while your company's revenues | | | | credit card number. When the two addresses fail to |
| continue to grow. Unfortunately, there are a number of | | | | match, the AVS notes the discrepancy (called an |
| potential problems which may not only try your | | | | AVS Mismatch) and causes the transaction to be |
| patience, but can even threaten the status of your | | | | declined. |
| merchant account. | | | | There are a couple of limitations with AVS. First, it is |
| Chargebacks are a major concern for small business | | | | primarily used within the U.S. as well as throughout the |
| owners, especially while processing payments online. | | | | U.K. and Canada. Most online credit card fraud |
| They're expensive, inconvenient, and can occur for | | | | originates outside those countries. Second, AVS only |
| several reasons. What's more, if a business owner | | | | checks the numeric portions of a cardholder's mailing |
| receives too many of them, his merchant account | | | | address. While this is not a significant limitation of the |
| provider may terminate his account, placing him on the | | | | system, it is worth noting. Even so, all merchants should |
| Terminated Merchant File (also referred to as | | | | use AVS when processing online payments. |
| MATCH). | | | | Inform Customers About Their Statements |
| In most cases, chargebacks are requested because | | | | If you're using a third-party payment processor, your |
| cardholders identify transactions which are | | | | customers' statements will probably list that |
| unauthorized. In that context, for merchants, avoiding a | | | | processor's name on the transactions. Don't expect |
| chargeback is a matter of thwarting fraudulent activity. | | | | your clients to remember their purchase simply by |
| Below, we'll provide a few tips that you can use to limit | | | | noting the transaction date and dollar amount. Several |
| your vulnerability to chargebacks when accepting | | | | weeks may have passed between their purchase and |
| credit cards online. | | | | their review of the statement. Memories fade and |
| Use The Security Codes | | | | chargebacks often follow. |
| Every major credit card issuer places a security code | | | | Let your customers know at the time of their |
| on their customers' cards. They're called CVC2 and | | | | purchase what they can expect to see on their |
| CVV2 codes. Visa, MasterCard, Diner's Club, and | | | | statement. You can eliminate their confusion and |
| Discover use 3-digit codes while American Express | | | | reduce the chances of their requesting a chargeback. |
| uses a 4-digit code. They were developed as a | | | | Protecting Yourself And Your Customers |
| security protocol to be used specifically for "card not | | | | As online sales continue to increase, there will likely be |
| present" transactions (for example, when processing | | | | a similar increase in fraudulent activity. The success of |
| payments online or over the phone). | | | | your online business depends upon being able to |
| Neither CVC2 and CVV2 are included on the | | | | process payments without falling victim to |
| magnetic strip. That prevents criminals from acquiring | | | | fraud-related chargebacks. Take advantage of |
| the codes by swiping the strip through a terminal. As a | | | | existing security protocols offered by AVS as well as |
| result, when merchants ask for the CVC2 and CVV2 | | | | CVC2 and CVV2. Plus, keep your customers |
| before processing online payments, they often thwart | | | | informed about what they should expect to see on |
| would-be offenders. | | | | their statements. By limiting your exposure to |
| Take Advantage Of AVS | | | | chargebacks, you can continue growing your |
| The Address Verification System (AVS) is a security | | | | business's revenue while confidently maintaining your |
| measure that compares the mailing address of a | | | | merchant account. |