Our credit card processor uses the Address Verification System (AVS) to verify certain pieces of information (such as address and zip code) on every transaction. This system helps protect Internet merchants from credit card fraud.

When you enter an order on our website and pay with a credit card, the transaction details are forwarded to your bank. Your bank accepts or declines the transaction based on their own criteria (funds availability, card status, etc.), but they also return an AVS code to our bank that indicates how well the address you provided matches up with the address they have on file for this card. There are many AVS codes that may be returned (search for “AVS codes” online for a list), and our bank then makes an accept/decline decision based on this code and other factors.

Most of the time, cards fail because some piece of information does not match what the card-issuing bank has on file. If you have recently moved, for instance, and the issuing bank still has your old address on file, but you enter your new address, the card will be rejected. Understand that small inconsistencies (such as entering 7802 Any Street while your bank thinks you live at 7802 Any Road) won't cause the transaction to fail, as the banks realize that these sorts of things are bound to happen. They're more interested in whether the street number and zip code match.

This can be frustrating because customers often respond that they can use the card successfully with other retailers. There are several reasons why this might be the case. First, AVS is only used by online retailers, as an added measure of security since the card is “absent.”  In card-present situations, such as at a restaurant, they're not using AVS, so the fact that the card works there is not relevant. If the card can be used successfully at other online retailers, then one of two things is occurring: either the retailer's card processor isn't using AVS (unlikely), or they're less conservative than our card processor and are allowing transactions even though the address doesn't match what the bank has on file. Our processor doesn't give us the option of circumventing this situation though, if the address doesn't match, then they're not accepting the risk whether Acme Guitar Works likes it or not.

The easy solution here is to call your bank at the customer service number on the back of the card and get them to change the address on file, since the AVS code they're supplying to us is the same as the code they're supplying to everyone else. Note that we've seen situations where the customer was receiving their statement correctly, but somewhere in the bank's records was another address for this customer, and this was the address being used for AVS. We even saw one case where a customer had applied for a card while living at his current address, had received every statement at this address, but the bank had other addresses in its records from older accounts, and was using one of these older addresses for AVS. A quick phone call to the bank will resolve the issue.

Understand that your bank may accept a transaction while our bank declines it. For instance, if your bank accepts the transaction but returns an AVS code of “N” (no address match), then our bank will decline the transaction because it is deemed a poor risk. In this case your bank will have debited your funds availability for this transaction, but you will not ultimately be charged for it.

In other words, your bank has been presented with a transaction, and they have looked at your card balance and credit limit and confirmed that you have sufficient funds available on the card for the transaction. They have approved it. They assume therefore that a charge for that amount will be presented by our bank within the ensuing several days, so they reduce your funds availability on the card by this amount. If you try the card again and the same thing happens, then they will assume that two transactions will now be presented by our bank, so they will reduce your available funds again.

However, because your bank returned an "N" AVS code, our bank has declined the transaction, and so to them the transaction is dead and will never be presented for payment. Your bank doesn't know this, so the debit on your funds availability will remain in place for some specified period of time before falling off automatically when no charge is actually presented by our bank. This time period varies from one bank to another, but generally its 48-72 hours.

If your credit card is already charged nearly to its limit, then this debiting of your funds availability might mean that even if you sort out the AVS issue with your bank, you will no longer have available funds with which to make a purchase. For instance, if you have a $1000 limit and a $500 balance, and you present a $300 transaction which your bank approves but ours declines, then your bank will now show only $200 available. So if you were to retry the $300 transaction, your bank would decline it because your available credit is less than $300. Of course, since our bank declined the transaction, it will fall off automatically in a few days, and then you would be able to retry the transaction.