Posted by Chuck on December 7, 2017
Credit Cards

Published on December 7th, 2017 | by Chuck


Discover Joins Mastercard in Eliminating the Signature at Checkout

Discover announced it will no longer require signatures at the point of sale for credit/debit card transactions beginning in April 2018. Mastercard made a similar announcement in October with the same April 2018 timeframe for implementation.

The card networks are quick to point out that they have the security framework in place to ensure all transactions are valid without the signature requirement.

“With the rise in new payment security capabilities, like chip technology and tokenization, the time is right to remove this step from the checkout experience,” said Jasma Ghai, vice president of Global Products Innovation at Discover.

Anything that makes checkout take less time sounds good to me, experts have said the signature doesn’t do anything to enhance the security, regardless.

With Mastercard and Discover going this route, we can only guess the pressure is on Visa and Amex to do the same. A larger question is whether individual retailers will take steps to eliminate the signature requirement from the checkout process. Once all networks don’t require it, they’ll be quicker to do so, but so long as it’s only Mastercard and Discover, I can see that being an issue.

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When I 1st saw this I thought to myself, They should keep it because it prevents fraud.
However, they’re correct to point out that a signature does nothing to enhance security.
It’s the signature on the back of the card that’s used at the POS to compare if it’s the cardholder or not, not what the CC company may have on file.
Many people don’t sign the back of their card or put a message to check for ID. Many cashiers don’t even verify the signature on the back of the card, so no signature or a message has very little impact on preventing fraud. Further, quite a few people, like myself, have a signature you can’t really read. You can tell there is a pattern, but cashiers are not trained nor would they really care to take the time to compare that. They’re also not paid to try to decipher signature. In this day and age, the quicker through check out the better. That’s also what leads to fraud.

Relying on signature to enhance security is senseless. I think when signature was first introduced to credit cards, it mainly served as a form of consent of the card holder, as well as a record given to banks and merchant for legal and bookkeeping purposes.

I expect more retailers will require ID when signature is eliminated

Requiring ID for a credit card purchase is against the terms of service for merchants. They are not allowed to do that.

Many still ask for ID, rules be damned

I agree with you man, but it is the cashier’s opinion that matters if we want to purchase those gift cards. I blame the scammers the most.

Curious why so few lawsuits there are over checked ID’s on CC purchases.

Who, but the most half-assed scammer, doesn’t carry fake IDs by the dozen?

Eliminating the signature requirement does nothing for cardholder security. It doesn’t even shift liability between issuer and merchant.

I’m willing to wager it’ll be at least another decade before the US adopts chip-and-PIN, and by then it’ll already be obsolete.

Only time a merchant will require ID is if they have reason to believe there may be fraud or a chance of a fraudulent transaction. They do have the right to prevent fraud, as fraud impacts the merchant the most. However, to ask for ID for every single transaction they process is counterproductive.

Yes, signatures really do nothing for security. Nowadays I usually just draw a squiggly line, or a smiley face as my signature or something like that.

Same. I’ve signed my purchases before as Steve Jobs, the band Creed, and a handful of other things. I believe I also read an article once about a guy that drew a picture of a whale for his signature and even tried signing his name with the word “Unauthorized” and all transactions were charged as normal.

Yes, a reporter from the New York Observer/Village Voice or something like, did something similar a few years ago, and it made a great impression on me. He went all over the city, even to Walgreens-level national chains, and signed anything and everything with the e-pen at the POS. He signed his own name to his partner’s/coworker’s card (willingly offered for the experiment) on which he wasn’t a signatory; he signed “Mickey Mouse”; he drew a straight line for his signature; etc.

Signatures are complete and utter waste of time. I can count on one finger in the last decade anyone as ever checked my signature. I haven’t used my signature once – it’s just a line and a quick tap of the accept button. When I see people laboriously signing their full name, it’s like being stuck behind assholes who still write checks.

Get with the program Visa and Amex!

+2 for check writing. Don’t these people have debit cards? What’s the deal?

Those people are just really, really old-timey old.

Let’s be respectful. They won’t be around forever..

10 years from now the industry will do away with physical cards and send the new account directly to Apple Pay after verifying your smart phone upon approval.

You have to have a populace that has almost completely adopted digital wallets to eliminate physical cards, I don’t think that will happen within 10 years. The adoption rate is increasing, but you have to reach critical mass to do away with that and I don’t see that happening until the boomer generation is much smaller as they are laggards in terms of technology adoption.

In other news…Visa spent a year developing a signature sound

The “Closing Bell” crew discusses Visa’s signature sound, which the company spent a year developing, that will be used on their payment app.

I agree that a signature is very ineffective at stopping card fraud. However,there is a difference between MasterCard/VISA eliminating the requirement for a signature and Discover/AMEX. The former merely run networks that payments travel on while the latter also issue the cards and are, therefore, bearing the fraud losses. MasterCard and VISA bear NO fraud losses. In fact, they are still paid their transaction fees on the fraudulent transactions It is the banks and credit unions that issue the cards that take all the losses, yet the networks can make decisions like this about whether a signature is required. It was VISA and MasterCard that decided the US would operate under chip & signature instead of chip & PIN like most of Europe. The networks feared that many consumers in the US were too dumb to remember a PIN and that would cut into their revenue from completed transactions. Smart move on their part since they don’t get hit with fraud losses.

“Anything that makes checkout take less time sounds good to me, experts have said the signature doesn’t do anything to enhance the security, regardless.”

Please proofread.

Could this be the end of tipping in restaurants?

The receipt will probably still contain a signature line, but only to authorize the tip (but I doubt they’ll tell you that).

Doubt it, even in countries with PIN + chip tipping is still possible

The signature requirement is so pointless. I just draw a wavy line and cashiers have never cared. I wish we would use a PIN for all credit cards. The Target Red Card credit card uses chip and PIN. The Target credit card is one of the credit cards I bring with me for international travel because of the PIN. I can buy metro tickets with it at a kiosk.

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