Over the past several weeks both Mastercard and Discover have announced that they’re eliminating the signature requirement for purchases made in the US and Canada. The logic is to speed up the amount of time that it takes to complete a purchase, in hopes of getting consumers to favor a card that expedites the purchase process. Signature requirements are useless nowadays, given that they’re not actually verified at the time a purchase is made. If you’ve ever dealt with credit card fraud, you’re not even asked to look at receipts and confirm if a signature is from you. So it’s an outdated concept that really is just a security theatre of sorts.
I was wondering when American Express and Visa would follow Mastercard’s lead, and it looks like we now have our answer. American Express has announced that they’re eliminating their signature requirement worldwide as of April 2018. So not only are they matching Mastercard and Discover, but they’re one-upping them, as they’re eliminating the requirement globally rather than just in parts of North America. Keep in mind that American Express has much less acceptance globally, so it’s logical enough for them to try and implement something that gives them an advantage outside the US.
Per Amex’s press release:
“The payments landscape has evolved to the point where we can now eliminate this pain point for our merchants,” said Jaromir Divilek, Executive Vice President, Global Network Business, American Express. “Our fraud capabilities have advanced so that signatures are no longer necessary to fight fraud. In addition, the majority of American Express transactions today already do not require a signature at the point of sale as a result of previous policy changes we made to help our merchants.”
The need for signatures has declined around the world due to a number of advancements in the payments industry. These include the growth of contactless payment options, including card-based and mobile tap-and-pay methods, the global adoption of EMV chip technology, and the continued expansion of online commerce. American Express has also deployed advanced machine learning algorithms that allow for more precise detection of fraud while minimizing disruption of Card Members’ genuine spending.
Prior to this change, American Express has already eliminated signature requirements for transactions of under 50USD in the US, under 100CAD in Canada, and under 30GBP in the UK.
I think it’s worth noting that even once this change is implemented, merchants will still have the option of collecting signatures, it just won’t be required by Amex. So don’t expect that you’ll never be asked for a signature again when paying with an Amex, even though Amex doesn’t require it.
Now I guess Visa is the last payment processor to still have a signature requirement…
Yep @Dan and @Linda
I've finally given up arguing with issuing bank about how thier cards actually work in Europe.
@mkcol Most US issued Amex cards don't support chip and pin at all. They currently require chip and signature. The work around it to use a phone to tap and pay via Apple Pay or Android pay since US issued cards don't come with contactless built in.
What's the drama with you lot struggling to use AMEX in the UK?
Chip & PIN was introduced in 2004
Contactless in 2007 when the transaction limit was £10. It was later upped to £20 and in September 2015 raised to the current £30.
You will get random fraud prevention random security checks on contactless (with any card issuer) to sometimes get you to use Chip & PIN after X number of contactless transactions,...
What's the drama with you lot struggling to use AMEX in the UK?
Chip & PIN was introduced in 2004
Contactless in 2007 when the transaction limit was £10. It was later upped to £20 and in September 2015 raised to the current £30.
You will get random fraud prevention random security checks on contactless (with any card issuer) to sometimes get you to use Chip & PIN after X number of contactless transactions, especially in a short space of time - this is to try to reduce fraud if the card is lost/stolen & used by someone other than the cardholder.
It's not exactly rocket science....
Sorry, these have been implemented in most economies, except for the US. No big news about it. UK has had chip and pin for the last 8 years. India has had it for credit cards for the last 4 years. No biggie.
@Luke I hope we'll get there one day, but that requires a wireless/handheld card reader, and the vast majority of restaurants in the US have card readers that either plug into the wall or are built in to a POS system behind the scenes. On top of that a significant percent of them still plug into a landline phone and call a number to authorize a purchase. Between the wired infrastructure and tipping culture, I...
@Luke I hope we'll get there one day, but that requires a wireless/handheld card reader, and the vast majority of restaurants in the US have card readers that either plug into the wall or are built in to a POS system behind the scenes. On top of that a significant percent of them still plug into a landline phone and call a number to authorize a purchase. Between the wired infrastructure and tipping culture, I think we'll still see signatures in restaurants/bars for a while. For everything else though, this is a great step in the right direction.
@Jon In Europe (and Canada), you generally enter the tip on the card machine yourself, so in those situations I doubt a signature will be required.
You can use Android Pay contactless at Monoprix and many other places in France
Any idea what restaurants will do? I feel like they should still require signatures when tipping.
@Mike L - Which will not solve Dan's problem. It defaults to signature, so he'd still have to sign the stupid paper.
@Dan The Barclaycard Arrival Plus World Elite is a Chip and Pin card... Go Get It.
Chip and pin make so much more sense. Don't really understand why americans cannot have that technology since it is way more secure. Also, any issuer who put one out would get an immediate surge of applicants from frequent travelers even absent a sign up bonus.
It is so embarrassing in the UK to be using self check out and have the clerk come over with a magic marker for you to sign some random piece of paper due to my "stupid yank credit card"
@Rob P, I use my UK Amex at Monoprix with chip & PIN when I go back home, never had to sign anything. I guess with an American card it might be a bit different?
I agree that in the UK and Europe it's a mess. For example, let's say it's a £10 transaction. Sometimes with my AMEX I enter my PIN. Sometimes I have to sign. Sometimes it's just tap and go. Craziness!
As an American living in France I would be very excited if this meant I could start using my Amex cards at places like Monoprix and not have to sign. This would definitely push me to move a lot of my spend to my Amex cards at the stores which accept it.
It would be amazing if this meant that the cards would work in chip-and-pin machines in europe. Sadly, I doubt it.