Could a Limited Acceptance Program be right for you?
February 6, 2018
What is cheaper: Pin debit or signature debit?
February 20, 2018
Major news was announced last fall that could very well change the way credit cards are transactions are handled. For as long as the credit card or its early variants have been around a signature has been required to complete a transaction. In April MasterCard will no remove the signature requirement for both debit and credit cards.
It sounds almost either too radical or something that has been a long time coming but an analysis of its transactions found that only 20% of them needed a signature in the United States and Canada. It is done partially to speed up the transaction process and MasterCard says its cardholders want the checkout process to speed up and that the signature requirement was only slowing the process down.
MasterCard says that there will be no impact on the security of the transaction since most people’s signatures are, well, lousy to begin with and those signatures are not checked against anything unless a consumer claims fraud. The company is also confident that the security that has been put in place by the EMV chips as well as their own network that are already in place will continue to prevent fraud. MasterCard is confident that new digital payment methods that are part of their state-of-the-art system like tokenization and biometrics will be just as efficient if not more efficient.
The move has also been applauded by merchants who want nothing more than to speed the checkout process up as well. They believe that this is a good step to providing a more consistent experience in chain retailers and will reduce both storage space that is required to store signatures as well as the power needed to keep that storage running.
This is a dramatic change here in the United States but will amount to nothing new in Canada where chip-and-PIN EMV cards are already in use and have already made the signature requirement obsolete. Considering that there is no good reason to keep that requirement around it was just a matter of time and will hopefully pave the way for chip-and-PIN here in the United States so we can join the rest of the modern world. At the very least Visa is sure to follow suit shortly.
