AVS is primarily used in what type of payment transactions?

Address Verification Service (AVS) is primarily utilized in mail order and telephone order transactions. This service plays a crucial role in increasing the security of card-not-present transactions, where the buyer is not physically present to swipe a card. By comparing the billing address provided by the customer to the information on file with the card issuer, AVS helps to verify the legitimacy of the transaction and reduce the risk of fraud.

In contrast, in-person swipe transactions do not require AVS since the cardholder's physical presence allows for immediate verification through other means, such as card authentication methods and signatures. Pre-approved credit line transactions generally involve established credit limits and do not necessitate AVS checks, as the cardholder has already been vetted. Bill payment services typically handle recurring payments and often have their own verification processes that do not depend on AVS, which is designed specifically for reducing fraud in card-not-present scenarios.