Credit cards have become one of the most common forms of payment. Quick to swipe and easy to carry, most cardholders barely give the security of their cards a second thought.
However, some cardholders have been turned away when trying to make purchases once the merchant noticed that their card was not signed. Why is this happening, and should you sign the back of your credit cards?
Why Do You Sign a Credit Card?
Many people believe that signing the back of a credit card is a security design meant to protect you from fraud and identity theft. This would seem counterproductive to some, wouldn’t having your signature be visible to the world make it more likely to be forged?
The truth is, the signature requirement is designed to protect the credit card companies. Your signature indicates that you accept their terms of service and doesn’t do anything to make your transaction more secure.
As more and more checkout lanes allow you to swipe your own card, there is less and less interaction between the merchant and the card. That means that there’s an even slimmer chance of the merchant noticing that your card isn’t signed, suggesting that it might not even seem necessary.
Writing “See ID”
An alternative to signing the back of your card is to write the words “See ID” or “Ask for a photo ID.” This would require whoever is using the card to provide the merchant with a photo ID proving ownership of the card.
However, this method has a number of drawbacks.
- Signatures indicate that the card is active. Many credit card companies use signatures on the back of cards as a way of ensuring that cardholders agree to the company’s terms of the agreement. A signature on the card is a sign that the card is valid and useable.
- Merchants may refuse unsigned cards for payment. The signature indicates that the card is valid and active. Using an inactive card for payment may be against the store owner’s policies or the conditions between the business and the credit card company.
- Showing ID makes the process slower. Showing your ID is an extra step that many card types, such as debit cards that use PIN numbers, deem unnecessary.
Card Signature Alternatives
Card companies in the US have recently moved to adopt more secure payment security methods. Europay, Mastercard, and Visa (EMV) cards, also known as “chip & PIN” or “chip & signature,” have taken the traditional swiping methods away and replaced them with two alternative forms of payments:
- “Chip dipping” or “insert chip” method
- The near-field communication method
These computer chips allow higher security than traditional magnetic strips. And the new technology also leads to an even easier purchasing process only requiring users to either insert their cards into readers or simply touch and go.
Additionally, the use of Radio-frequency Identification (RFID) chips has seen a rise. RFID chips are embedded into the plastic of the credit card and offer an even more secure method for identity theft.
Where to Sign a Credit Card
On the back of your credit card, you will find a white, blank strip. This is the signature bar of your credit card.
To sign, use a felt-tipped pen. This pen will allow the ink to stay, prevent it from smearing and prevent it from soaking into the plastic.
Sign your name the same way you would sign it on any other document. When a merchant compares your signature from one document to another, they should look the same.
Protecting Yourself from Credit Card Fraud
In addition to taking the necessary steps to make sure your card is valid, you should be proactive against possible credit card fraud. Here are some of the most important tips to keep in mind.
- Never let other people use your credit card
- Only carry the cards that you need
- Stay paperless
- Monitor your spending
Protect Your Credit Card
Credit cards are only as secure as you treat them. Remember to follow all responsible credit card habits to avoid identity theft or credit abuse.
If you’re struggling with credit card overuse, high credit debt or any other credit card related issues, talk to our credit coaches today.