We’ve all been used to using Chip and PIN when we make debit and credit card payments for so long now, it’s hard to remember a time when we had to sign for our purchases.
And yet, there’s still a strip on the back of cards that you have to sign. So why is this?
Let’s find out.
Yes – that’s exactly why Chip and PIN was introduced. It’s a lot more secure than relying on you to sign. If someone stole your card, they only had to turn it over to get an example of your signature that they could then copy when making purchases.
With Chip and PIN, the responsibility is on you to memorise your unique PIN number and keep it secret. If your card falls into the wrong hands, it’s very difficult for someone to use it if they don’t have your PIN.
Another way in which Chip and PIN is safer than other security methods is that it’s no longer up to the cashier to verify the card is yours by matching your signature to the one on your card. Instead, this is checked by the machine you pop your card and PIN into.
So if Chip and PIN is so safe, why’s there still a signature strip?
Quite simply, signing your signature strip gives you another way to verify that you are who you say you are when you use your card. For example, if a shop’s Chip and PIN machine stops working, the cashier might ask you to sign for the goods instead.
So, when your new credit or debit card arrives, always sign the signature strip. Even if it never ends up being used, it’s there for a reason.
What about contactless?
"Contactless lets you make purchases up to £30"
Of course, nowadays it is possible to make purchases with most debit and credit cards without signing or entering your PIN number. Contactless technology lets you pay for things far faster by simply tapping your card against a card reader, rather than putting in your PIN.
Contactless lets you make purchases up to £30 – but if your bill comes to more than this, you’ll be asked for your PIN. You can’t use this method to withdraw cash.
Perhaps because there’s no security check in place other than you keeping a close eye on your card, you’re worried about the safety of contactless. After all, if you’re not asked to prove you own the card to use it, a thief won’t be either.
That’s why you can only make small purchases with contactless cards, and also why you can’t withdraw cash. And if your card is stolen, you must report it to your bank or lender straightaway, just as you would if it wasn’t a contactless card. Your card will then be cancelled, and if any further payments are made using the card, your provider may be able to reimburse you.
So, that’s the question of why your credit card has a signature strip answered. For more information on credit cards, come back soon.
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Intelligent Lending Ltd (Credit Broker). Capital One is the exclusive lender.