Understanding Address Verification Code S in Recurly

Merchants using Address Verification Service (AVS) may notice that some transactions are successfully processed even when an address check cannot be completed. This most commonly occurs when the issuing bank returns AVS response code S.

This behavior is expected and applies across supported payment gateways when the issuing bank does not participate in AVS. It is not indicative of a misconfiguration or issue within Recurly.

What AVS Code S Means

AVS Code S indicates that the issuing bank does not support address verificatio. In this scenario:

• The address provided was not evaluated
• No match or mismatch result is returned
• The bank does not supply address-level fraud signals for the transaction

Because no comparison is performed, Code S is neither a pass nor a fail in the traditional AVS sense.

How Recurly Handles AVS Code S

When AVS is enabled on a Recurly site and a transaction returns Code S:

• The transaction continues to be processed
• No automatic rejection occurs based solely on Code S
• The AVS result is surfaced exactly as received from the gateway

Recurly’s AVS logic evaluates supported AVS response codes only. Unsupported responses do not trigger rejection rules.

Why Transactions Are Still Approved

Transactions with AVS Code S are approved because:

• The issuing bank has opted out of AVS participation
• No address verification result is available to act upon
• Authorization decisions are made by the gateway and issuing bank

Since no verification failure occurs, rejecting these transactions by default would risk blocking legitimate payments from banks that do not support AVS.

What Recurly Can and Cannot Control

Recurly Can

• Send AVS-enabled authorization requests to supported gateways
• Surface AVS response codes exactly as returned
• Apply rejection rules for supported AVS mismatch responses
• Offer additional fraud prevention tools

Recurly Cannot

• Force issuing banks to support AVS
• Override gateway or issuer authorization decisions
• Automatically decline transactions solely due to unsupported AVS responses

All approval decisions ultimately originate from the payment gateway and issuing bank, not Recurly.

Recommended Next Steps

If AVS Code S transactions are a concern, consider the following actions:

1. Enable layered fraud controls
   Use additional fraud signals beyond AVS to reduce risk.
2. Review transactions holistically
   Evaluate CVV results, velocity patterns, and customer behavior alongside AVS.
3. Monitor trends rather than isolated cases
   Unsupported AVS responses should be reviewed over time to determine material risk.
4. Share product feedback on desired behavior
   Merchants who want more granular control over unsupported AVS outcomes can submit product feedback for consideration in future enhancements.

Final Notes

AVS Code S responses can be frustrating when reviewing potential fraud, but they reflect limitations at the issuing bank level, not a failure of Recurly’s AVS configuration. Leveraging layered fraud controls is the most effective way to manage this risk.