Should you sign your credit card?
Take a close look at the back of your credit card, and you will probably see something along the lines of "Not valid unless signed." At the same time, there are many cardholders who believe that they should not sign their credit cards for one of several reasons.
Some think signing the back of their card gives potential thieves a copy of their signature to use to forge their name. Others believe that they are better protected by writing "See ID" in their card's signature panel. So what is a smart cardholder to do?
Sign your card
The whole point of a signature is not that it is a secret symbol known only to you, but that only you can accurately duplicate it on command. It is not that hard for anyone to see a copy of your signature from public records or from a canceled check or of course, from the credit card receipts you must sign. The hard part is quickly and precisely forging a signature on a register receipt. A thief might be able to fool a cashier in a hurry, but the signature will easily be identified as a forgery if the cardholder contests the charge.
Another reason to sign the card is that merchants are not supposed to accept a credit card unless it is signed. Certainly, that is what is implied by the "not valid unless signed" message on the back of the card. In addition, payment networks tell merchants that the signature is required. For example, look at this document that MasterCard posts on its website warning, "MasterCard rules and security procedures require that credit cards must be signed by the cardholder in order to be accepted for payment." This document even addresses situations where the signature panel is filled in with "Ask for Photo I.D." by advising merchants that "The transaction cannot be processed unless the cardholder's signature appears in the signature space." For its part, Visa does not even allow merchants to make the display of photo ID a condition of card acceptance.
Beyond signatures
While the terms of credit card use couldn't be more clear, the reality is that few cashiers bother to examine the signature on the back of a credit card. Furthermore, many merchants no longer require a signature for smaller transactions, and there is no way to provide a signature for transactions authorized over the telephone or through the Internet.
Additionally, the recent string of high-profile security breaches at retailers across the nation have put a spotlight on the outdated security measures employed by the credit card industry. For example, criminals who obtain credit card numbers can easily clone these cards and don't even have to accurately reproduce your signature on the back, just their own version of yours.
The next generation of credit cards will ultimately use a chip-and-PIN system, which negates the need to ever sign the back of your credit card, or your receipt. Instead, cardholders will enter their credit card's four-digit personal identification number, just like they currently do with their ATM and debit cards.
If you're worried about credit card security, be sure to monitor your financial accounts regularly for signs of unauthorized charges. You may also want to keep an eye on your credit scores for signs of new account fraud (when an identity thief opens an account in your name). You can check your credit scores for free every month on Credit.com.
So instead of asking whether you should sign your credit card, just do it for now, if only so you can tell future generations about the novelty.
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