You may not be jotting your name on payment slips and checkout terminals much longer. Mastercard plans to ditch the signature requirement at merchants in the U.S. and Canada in April 2018, and experts say other card networks likely will do the same.
Mastercard says more than 80 percent of the in-store transactions (also known as point-of-sale purchases) it processes now don’t need a signature.
Jack Jania, senior vice president of strategic alliances at Gemalto, expects Visa, American Express and Discover also will follow Mastercard in ditching the need for signatures within a year.
If Jania’s prediction holds true, that would spell the end of a decades-old ritual for cardholders.
“This is a good move for both consumers and merchants, as it will speed up the in-store purchase experience,” Jania says.
Here’s a rundown of the status of sign-the-receipt policies at Visa, American Express and Discover.
Signature policies at card networks
More than three-fourths of Visa’s face-to-face transactions in North America don’t require signatures, says Jeanette Volpi, head of North America communications at Visa.
“Visa supports multiple technologies to bring speed, security and consumer convenience to the authentication and authorization process,” Volpi said in a statement.
Asked when Visa might institute a complete no-signature policy, Volpi declined to comment beyond the statement.
American Express already has removed the need for a customer’s signature for in-store transactions of less than $50 in the U.S. or less than $100 in Canada, spokesman Andrew Johnson says.
Asked when American Express might wipe out the $50 and $100 thresholds, Johnson says: “We’re always looking at ways to enhance the checkout process, including reviewing our signature policy.”
Discover is evaluating whether to institute a no-signature policy as part of its “continued goal to improve the checkout experience,” spokesman Chris Thonis says.
As with Visa and American Express, Discover has no timetable for potentially lifting its signature mandate.
“Discover is committed to improving the payment experience and removing inefficiencies for both the customer and merchant at checkout,” Thonis says.
“We’re continually implementing the latest changes in digital authentication technology , such as tokenization, multifactor authentication or biometrics, to ensure a secure and seamless transaction for customers and merchants.”
“This is a good move for both consumers and merchants, as it will speed up the in-store purchase experience.”
‘A costly yet feeble means of securing transactions’
The Retail Industry Leaders Association and even Walmart, the nation’s largest retailer, say it’s time to say so long to the signature requirement.
“Mastercard’s decision to end signature verification acknowledges what retailers have long argued, that signatures are a costly yet feeble means of securing transactions,” says Austen Jensen, vice president for government affairs at the Retail Industry Leaders Association.
“Going forward, the payment industry needs to focus on finding solutions to the growth of fraud both in stores and online, where current measures are inadequate for protecting consumers and merchants.”
Walmart said in a statement about Mastercard just saying no to the signature:
“Removing this step at checkout will save time for our customers and decrease the expense associated with storing and presenting signatures back to the issuer, all while preserving security for customers.
“We anticipate this will result in savings that can be used to continue to lower prices for our customers.”
Is safety in jeopardy?
Industry insiders don’t think the rollout of no-signature policies by Mastercard – and potentially by its rivals – will endanger cardholders’ data.
Philip Andreae, a consultant in the digital payments industry, questions whether the signature requirement for in-store card purchases really improves the security of transactions.
Why? Merchants typically don’t check a cardholder’s signature – either on a paper receipt or an electronic screen – against the signature on the back of a card, he says, and many cardholders fail to sign their cards anyway.
“If merchants were doing what they are supposed to do, then maybe it has added a level of security,” says Andreae, of Philip Andreae and Associates. “Otherwise, as it is today, there is no value.”
Gemalto’s Jania believes not requiring signatures will have no effect on card security, since existing chip technology and other high-tech tools for verification of a cardholder’s identity aren’t going away.
Laura Townsend, senior vice president of operations at the Merchant Advisory Group, agrees. In a statement, she praised Mastercard’s move and noted that “new and improved” digital authentication tools – such as face, voice and fingerprint recognition – will bolster the security of in-store transactions via credit or debit card.
“What consumers will find reassuring is that removing the need to sign for purchases will not have any impact on safety.”
Not a ‘radical’ idea
Mastercard describes dropping the signature as “another step in the digital evolution of payments and payment security.”
“At first glance, this might sound like a radical proclamation, especially to people who have had credit and debit cards for decades,” Linda Kirkpatrick, Mastercard’s executive vice president of U.S. market development, wrote in a blog post announcing elimination of its signature requirement.
“However, the change matches all of our expectations for fast and convenient shopping experiences.”
Mastercard says merchants such as retail stores and restaurants will be offered the option to ask for signatures, though.
Kirkpatrick stresses that ensuring the security of credit and debit card transactions continues to be a top priority for Mastercard.
“What consumers will find reassuring is that removing the need to sign for purchases will not have any impact on safety,” she wrote. “Our secure network and state-of-the art systems combined with new digital payment methods that include chip, tokenization , biometrics and specialized digital platforms use newer and more secure methods to prove identity.”
Mastercard research shows most cardholders and merchants are ready for the signature requirement to die, particularly since that will accelerate the checkout process.
“While security remains paramount,” she writes, “we know that convenience is also a large part of what consumers want when they are shopping and paying. … The move will help merchants speed customers through checkout, provide more consistent experiences for every customer with every purchase and should decrease costs associated with safely storing signatures.”
So, Mastercard likely will be the first, and experts and retailers expect its competitors to follow suit. The end result will be the signing off of the signature for payments – and faster checkout.
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