What Can Merchants Do: Accepting a Credit Card Without a Signature

Brendan Harkness

Brendan Harkness | Blog

Jun 17, 2014 | Updated Apr 27, 2016

Have you ever wondered why you are supposed to sign that little box on the back of your credit card, even though merchants don’t usually even glance at it?

The signature on the back of your card is a security measure. When you buy something with a credit card, the merchant could verify your identity by matching the signature on the card to the signature you write on your receipt.

You’ll typically only find signed cards in the U.S. Countries in Europe and elsewhere are using the newer chip-and-pin or chip-and-signature systems for card security.

Personally, I’ve never had my signature checked against the signature on my credit card, and I don’t hear about it happening often. If merchants usually don’t care to check it, do we really need to sign our cards?

No Substitute for a Signature

It turns out that the major credit card issuers do require that signature after all, as a serious aspect of their fraud prevention strategy. When they say “not valid unless signed,” they actually mean it.

The official process for a Visa Card transaction, for example, ends with the merchant requesting a signature from the cardholder on the receipt, and then checking that signature against the one on the back of the card.

Here, the regulations are very clear. If there is no signature on the card, the merchant must request that the cardholder sign the card then and there, or else the transaction should be refused. The cardholder must also present a current form of government ID to the merchant at this time.

Then, the merchant should check the signature on the card and the signature on the receipt to ensure that they look reasonably similar before finishing the transaction.

Do Merchants Always Check?

Of course, merchants can choose to ignore these regulations, and will save time by not checking signatures. There is typically a store policy about checking signatures, but by not checking they end up putting themselves at higher risk, making it easier for fraudulent purchases to be made.

As an additional convenience to the customer, some merchants don’t even require a signature on the receipt for smaller purchases, such as those under $25. This is another risk, but for many merchants it’s worth it, thanks in large part to modern credit monitoring and security systems.

You can also check out the MasterCard regulations on unsigned cards, which are identical to Visa’s.

What if I write “See ID” in the Box?

Nope, there’s still no substitute for a signature. Some people like to write “See ID,” or “Ask for ID” in the signature box, but this does nothing and is equivalent to an empty box.

When presented with a card that says “See ID” in the box, merchants are supposed to go through the same process described above. This is also true for photo cards, that feature the cardholder’s picture on them. The photo is not good enough (even though it might actually be better than a signature): if the box is unsigned, the card is technically not valid to be used.

 

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