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MasterCard Has Finally Realized That Signatures Are Obsolete and Stupid (fastcompany.com)
An anonymous reader shares a report: For years, credit card companies have relied on an illegible squiggly line as the frontline of defense against credit card fraud. Customers are forced to use a pen (how retro!) to scrawl their signature on bills at restaurants and sign digitally at cash registers -- as if somehow in the age of chips, PINs, biometrics, and online fraud alerts, a line on a page is still a great tool against fraud prevention. Personally, I have been known to sign on the dotted line with a doodle of a piece of tofu and no one has ever stopped me, because signatures mean very little in this digital age. Companies are finally seeing the light. Starting in April 2018, MasterCard cardholders will no longer be required to sign their name when they purchase something using their debit or credit cards. The company has been moving away from requiring signatures for a few years now, with only about 80% of purchases (typically over a certain dollar amount) requiring a signature these days. MasterCard did some digging, though, and per its press release, realized that most of their customers "believe it would be easier to pay and that checkout lines would move faster if they didn't need to sign when making a purchase."
Your signature is just an acknowledgement of payment it is not fraud control.
I have never signed anything when I've paid by card, be it MasterCard or Visa. Heck, I haven't even signed the back of my cards, nobody looks there anyway.
At one time it was easier to demand payment if someone signed a contract, every receipt was signed to acknowledge that you agree to pay. But now the novella sized contract of ultra fine print that you automatically agree to when the credit card company sends it to you is sufficient.
I really wish we'd go to Chip + PIN. We have the technology, and it's far more secure than the chip-only nonsense that we use in the US.
It's for verification of purchase after the fact, not to prevent fraudulent purchases at the time of transaction.
Mind you, it's still kinda stupid because if someone is planning on disputing a charge they can just fuck up their signature at time of transaction BUT it's worth the clarification.
Mod me down with all of your hatred and your journey towards the dark side will be complete!
I don't remember signing for a credit card statement in YEARS. I think the only country I have heard that is still using signatures is the United States. Oddly they are also the only country I know that doesn't have straight up debit cards with no credit card company as a pre-processor.
I think both Visa and MasterCard have known for a long time that signatures doesn't a good way to prevent fraud from happening there just hasn't been much traction in letting the change happen.
I do it all the time. I signed the credit card thingy after paying for dinner last night. I don't know how you've avoided it, it's not like it's optional unless you selected debit and used chip+pin.
No worries. Amazon has a lot more than your signature on file!
I don't respond to AC's.
No, the signature was needed because that allows the credit card company to charge 2% commission from the merchant. The alternative to signature was to use a pin pad. If you use pin at the point of sale, the money comes directly from your checking account, there is no "risk" and it is no longer an unsecured credit given by the credit card company to the merchant. Point of sale terminals, pin and the ATM networks charge only a maximum of 25 cents per transaction.
It was a great marketing coup by Mastercard and Visa to create the "debit" cards, make it work in their network, and muddle the lines and demand 2% commission from the merchants. The consumers never cared about the difference. Eventually all the merchants complied and since all of them do it they were able to pass on the cost to us. So we pay 2% more on every purchase.
Unless a big player like Google or Apple come up with in independent payment network, competing with MC and Visa there is no relief for us. They all come up with ideas and fight with each other instead of Visa/MC. There is a demand for a payment method with low transaction charges for people who dont carry a balance, who have protection of 50$ limit on liability. Till something gains traction, there is nothing to challenge the duopoly.
sed -e 's/Chuck Norris/Rajnikant/g' joke > fact
Signing your signature on the line or your card was never about security.
It was about contracts.
Signing the back of your card means you agree with the Cardholder Agreement between you and your issuer. Merchants need to check the signature of the card because if it isn't signed, or signed incorrectly, it means the bearer (i.e., who holds the credit card) does NOT agree to the terms of the agreement and thus any transaction made can be null and void.
The cardholder agreement is that little piece of contract stating if you use the card, you agree to pay it off, interest rate, late payments, fraud, etc and all the other terms of the credit card. A merchant who does not verify your card can get screwed if you refuse to pay since you refused to agree with the agreement.
The slip that you sign is the same deal - it basically says you the bearer agree to pay the amount shown on the slip per your card holder agreement. If you do not agree, you do not sign the slip (this is especially true if the slip is incorrect - do NOT sign it). When doing a dispute, the credit card company looks at the slip and sees if it was signed. In the old days where they had the carbon paper slips and the slider machines that go ka-thunk as you used them, tearing the slip up has the same effect.
That's it. That's all the signatures meant.
And if you had "See ID" or something written on your card, the merchant is actually supposed to cut up the card - it is not a valid card (no on agreed to its use so its presentation means it must be destroyed as it's use is fraudulent).
With Chip+PIN, entering your PIN is basically agreeing to the charges, and since the PIN and everything is held securely inside the crypto processor on the smart card, it verifies you as the valid user.
And yes, this is why "Card Not Present" transactions are far more risky - you the merchant are basically relying on the good will of the customer to uphold their end of the agreement despite not actually having a signed agreement to do so.
The best way to prevent ID theft is to stop pretending it's a real thing. Identity theft should be treated as not having anything to do with the consumer whose identity has been "stolen" at all. It's fraud between the criminal and the financial institution or lender. It should immediately end, as far as the consumer is concerned, with a statement that the consumer didn't open the account.
Next, we need to get schools to stop requiring signatures on absentee notes when kids cut school. I'm pretty sure that during junior high I wrote my mom's signature more often than she did.
You are welcome on my lawn.
Well, technically no merchant is allowed to check ID, or accept a card with check ID written.
The USPS is simply not violating the contract they signed when getting a merchant account.
Wow, sent an e-mail as suggested when clicking on "use classic" banner, and got a fast response that addressed my msg
My father worked in credit card all his career. From most of the stories he'd tell, as much as not, the signature came up when somebody tried to decline charges. Once they find out the CC company have the signature and it looks like their signature, they admit they bought the item but were now having buyers remorse. Next comes signatures by other family who they loaned their card to with the intent of letting them buy stuff. Once faced with knowledge there is evidence that they or their agent used the card with their agreement, they stop trying to deny charges and just pay up.
They should have but then they bowed to all the companies that whined and complained even just about having to get chip readers.
Perhaps technically, but in the countless years I've done it on all my cards, I've never had a problem anywhere. Including the USPS.
Would be nice to see the USA crawl its way a bit out of the stone ages of credit card processing compared with the rest of the world. We shop in Canada a ton and their chip systems validate cards in 1-2 seconds, their portable wireless devices at restaurants are high-tech and slick, and PINs offer far more security than a signature. At this point, needing to use a signature is a shopping/dining speedbump akin to writing a physical check... justifiably seen as archaic and idiotic given modern knowledge and technologies. I find myself apologizing to the Canadians for it more than they apologize in general.
Took us forever to get chips while the rest of the world left us in the dust, and we're still stuck using stupid signatures. We had plenty of shame and were the laughing stock of the world well before Trump became the pinnacle of national embarrassment, but still.
Hell 99% of the time they don't even check ID. *facepalm*
That's because most merchant service providers don't require that the merchant look at the customer's ID. While some networks (MasterCard, VISA, Discover, AmEx) allow the merchant to reasonably verify that the customer is the authorized card holder, some also explicitly FORBID a merchant accept a credit card that is not signed, this is why they ask you to sign the card before they can accept it.
Many years ago, while working retail when you still had to use a 'knuckle buster' when accepting a credit card, our store was audited and we were fined for accepting an unsigned card. Merchant service providers don't seem to do things like this any longer.
Do what thou wilt shall be the whole of the Law - Aleister Crowley
By requiring a signature, they make the merchant liable for fraud. In case of a fraudulent transaction, they can claim the merchant didn't verify the signature matched the signature on the card, and thus it's the merchant's fault. They do a chargeback. The merchant is out the money and the item(s), and thus the merchant has paid for the fraud. Online sales work the same way - the website asks for your billing address and phone number not because they want to sell it to marketers (though they probably do that too), but because that's the only way credit card companies have set it up so merchants can "confirm" you're authorized to use the card. If the merchant fails to confirm all these facts and the transaction is fraudulent, the credit card company can just do a chargeback and make the merchant pay for the fraud.
Once you move to a real secure card system like Chip and PIN, the merchant is out of the picture. If the transaction went through when it wasn't supposed to, then it's the credit card company's fault and they have to pay for the fraud. If the transaction went through because the cardholder shared their PIN with someone else, then it's the card holder's fault and they have to pay for the fraud. The merchant is no longer liable. And the credit card companies have to make a choice between pissing off their customer (cardholder) or paying for the fraud themselves.. By keeping the merchant liable for as long as possible, they've been able to avoid this hard choice simply by shifting blame and the cost of fraud onto the merchant.
It took multiple acts of $DEITY to get a chip onto cards here in the US. Chip-and-PIN should have been deployed back in 2015, or else merchants would take the financial responsibility. I have yet to encounter a merchant that actually uses a PIN for the credit card side. A lot of stores still have the chip reader taped over, and one still swipes their card.
I wish the US could join the rest of the civilized world here. Chip-and-PIN for card present transactions, and for other stuff, it would be nice to have a little e-Ink display with a button that can be used with the card's PIN to ensure security for card not present transactions, similar to how SecurID cards work.
Of course a signature isn't a fraud *prevention* mechanism...it never was, unless the early days of credit cards saw vendors having databases of customer signatures against which to compare. The signature is there for fraud *investigation*. If you argue that your identity's been stolen, the firm investigates, pulls up the purchase slip with a signature that doesn't match yours, BINGO...they know you're not bullshitting.
Why so many people persist in claiming that the signature isn't used for fraud prevention is odd.
It's simple enough to pull up the Mastercard/Visa merchant rules and see that they explicitly use signatures as a means of verifying the person making the charge is the authorized cardholder and it has nothing to do with a future "fraud investigation".
That a signature can also be a piece of evidence in determining, after the fact, that the purchase was made fraudulently doesn't mean the signature isn't/wasn't a fraud prevention mechanism.
From Mastercard https://www.mastercard.us/cont...
"Performing a Signature Comparison
When a signature is obtained as the CVM for a Mastercard POS Transaction completed with a
Card (but not when an Access Device is presented), the Merchant must compare the signature
on the Transaction receipt with the signature on the Card to determine whether they appear
to be the same.
If the Merchant believes that the signature on the Card does not match the signature on the
Transaction receipt, the Merchant must contact the Acquirer for instructions. "
Why is that there? Fraud prevention
I'm pretty sure the rest of the world has been using Chip & Pin for at least a decade now... about time the ol' US caught up!
The CC is scanned for authentication. IThe transaction is not fullly processed at the time. They are finding out if the card is good and what amount of credit is remaining. That is taken into account when the cash register determines the total charge. If everything is in order then you're done (the transaction is settled later electronically). If the total you are purchasing exceeds the credit then it will be rejected and you'll be asked for payment method. This does mean that there's a period of time when you can exceed the credit limit, but that's not necessarily good for you, you still have the pay the total amount and it may affect your credit.
Processing and authentication takes time, and most stores are very anxious to speed this all up (one reason they dislike the new chip-only cards because they were taking extra time per customer).
How's life in the hypocrite lane?