Many merchants have been doing away with signature for debit and credit cards at the POS in favor of no cardholder verification method (CVM). As The Motley Fool has written, and I think many would agree, Mastercard’s announcement is really more of a formality and recognition that signatures don’t do much to protect merchants or cardholders:
Mastercard will become the first credit card company that no longer requires a signature at checkout for any credit or debit purchase in the United States and Canada. That could lead its rivals at Visaand American Express to do the same, or it could leave Mastercard with a lasting edge. What it won’t do, according to the company, is compromise security.
Mastercard states that 80% of transactions that are conducted in-store are done without a signature today. Merchants can decide if they want to alter their POS experience for consumers on the remaining 20% by removing the signature requirement completely. Making that change for just Mastercard transactions might be a little difficult. Perhaps the other major network brands will follow suit.
If a signature doesn’t make your purchase safer, then the other two major credit card companies will be pressured to do the same. If they don’t, there will be confusion at the checkout lines if some cards require signing and others do not. Were that to happen, it’s likely many merchants would simply ask customers to sign whether it’s needed or not.
Overview by Sarah Grotta, Director, Debit Advisory Service at Mercator Advisory Group
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