diff --git a/src/app.test.js b/src/app.test.js
index b56e2ea..06a7dba 100644
--- a/src/app.test.js
+++ b/src/app.test.js
@@ -2,6 +2,7 @@ import { expect } from 'chai'
 import request from 'supertest';
 import { build } from './app.js';
 import { getDataForExchangeSetupPost } from './test-fixtures/testData.js';
+import { clearKeyv, initializeTransactionManager } from './transactionManager.js';
 
 let app
 
@@ -54,7 +55,7 @@ describe('api', () => {
 
   describe('GET /healthz', () => {
 
-    it.only('returns 200 if running', async () => {
+    it('returns 200 if healthy', async () => {
      
       const response = await request(app)
         .get("/healthz")
@@ -64,6 +65,20 @@ describe('api', () => {
       expect(response.body).to.eql({ message: 'transaction-service server status: ok.', healthy: true })
      
     })
+
+    it('returns 503 if not healthy', async () => {
+     // we delete the keyv store to force an error
+      clearKeyv()
+      const response = await request(app)
+        .get("/healthz")
+
+      expect(response.header["content-type"]).to.have.string("json");
+      expect(response.status).to.eql(503);
+      expect(response.body).to.have.property('healthy', false);
+      initializeTransactionManager()
+     
+    })
+  
   
   })
 
diff --git a/src/transactionManager.js b/src/transactionManager.js
index a7eb996..77fd6ce 100644
--- a/src/transactionManager.js
+++ b/src/transactionManager.js
@@ -11,7 +11,9 @@ const defaultTimeToLive = process.env.DEFAULT_TTL = 1000 * 60 * 10; // keyv entr
 
 let keyv;
 
-
+/**
+ * Intializes the keyv store either in-memory or in file system, according to env.
+ */
 export const initializeTransactionManager = () => {
   if (!keyv) {
     if (persistToFile) {
@@ -83,9 +85,13 @@ export const getDIDAuthVPR = async (exchangeId) => {
   }
 }
 
+/** 
+ *  @param {string} exchangeHost 
+ *  @param {string} tenantName
+ *  @returns a function for processing incoming records, bound to the specific exchangeHost and tenant
+ */
 const bindProcessRecordFnToExchangeHostAndTenant = (exchangeHost, tenantName) => {
-  // returns a function for processing incoming records, bound to the specific exchangeHost and tenant
-  return async (record) => {
+   return async (record) => {
     record.tenantName = tenantName
     record.exchangeHost = exchangeHost
     record.transactionId = crypto.randomUUID()
@@ -154,7 +160,7 @@ export const retrieveStoredData = async (exchangeId, transactionId, didAuthVP) =
 
 /**
  * @param {string} exchangeId
- * @throws {ExchangeIdError} Unknown exchangeID
+ * @throws {ExchangeError} Unknown exchangeID
  * @returns returns stored data if exchangeId exists
  */
 const getExchangeData = async exchangeId => {
@@ -163,6 +169,19 @@ const getExchangeData = async exchangeId => {
   return storedData
 }
 
+/**
+ * This is meant for testing failures. It deletes the keyv store entirely.
+ * @throws {ExchangeError} Unknown error
+ */
+export const clearKeyv = () => {
+  try {
+    keyv = null;
+  } catch (e) {
+   throw new ExchangeError("Clear failed")
+   }
+   
+}
+
 /**
  * @param {Array} exchangeData Array of data items, one per credential, with data needed for the exchange
  * @param {Object} [exchangeData.data[].vc] optional - an unsigned populated VC
@@ -172,7 +191,7 @@ const getExchangeData = async exchangeId => {
  * @param {string} exchangeData.batchId batch to which cred belongs; also determines vc template
  * @param {string} exchangeData.data[].retrievalId an identifer for ech record, e.g., the recipient's email address
  * @param {Object} exchangeData.data[].metadata anything else we want to store in the record for later use
- * @throws {ExchangeIdError} Unknown exchangeID
+ * @throws {ExchangError} Unknown exchangeID
  */
 const verifyExchangeData = exchangeData => {
   const batchId = exchangeData.batchId