Can Merchants Require an ID for Credit Card Transactions?

Written by admin - 13 Comments

As a followup to my earlier article about merchants being unable to require a minimum purchase for credit card transactions

Did you know that merchants can’t require you to show an ID in order to complete a transaction?

According to a recent Q&A in the Baltimore Sun:

Although Visa rules do not preclude merchants from asking for cardholder ID, merchants cannot make an ID a condition of acceptance. Therefore, merchants cannot refuse to complete a purchase transaction because a cardholder refuses to provide ID. Visa believes merchants should not ask for ID as part of their regular card acceptance procedures.

As for MasterCard:

A merchant must not refuse to complete a MasterCard card transaction solely because a cardholder who has complied with the conditions for presentment of a card at the POI [point of interaction] refuses to provide additional identification information, except as specifically permitted or required by the Standards. A merchant may require additional identification from the cardholder if the information is required to complete the transaction, such as for shipping purposes.

Apparently, American Express and Discover have similar rules.

There are, however, some exceptions… For example, they can ask to see an ID if your card isn’t signed. And if you’re paying remotely, like over the phone or on the web, they can ask for identifying information such as your zip code (I’ve also seen on this on pay-at-the-pump transactions).

Of course, this doesn’t mean that all businesses follow the rules. If a merchant demands to see your identification, and then refuses you service if you fail to comply, your only real recourse contact the card company and provide them with the name of the business. Most card issuers will initiate an investigation and may even penalize the business for violating their merchant contract.

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Published on March 17th, 2008 - 13 Comments
Filed under: Credit Card Facts

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Comments (scroll down to add your own):

  1. As a cashier, I can tell you two other times that I request ID, which I feel is are legitimate reasons…

    1) The customer’s signature bears NO resemblance to what’s on the card.
    2) The customer has WRITTEN “See ID” or “CID,” regardless of the presence of the signature.

    I am also leaning towards asking for ID if there is a clear signature (not smudged or worn) that does not appear to contain letters. Checking ID’s adds valuable time to each transaction, so I may not implement this.

    Comment by Nathan — Mar 18th 2008 @ 7:46 am
  2. Every time I travel to Louisiana, I’m asked for ID when I use a credit card. I believe there could possibly be some sort of local law that requires merchants to check it.

    Comment by Ron@TheWisdomJournal — Mar 18th 2008 @ 12:26 pm
  3. I write “Request ID” in the signature block of all of my credit cards because I WANT merchants to verify my identity. Worth a moment of my time, having been identity-thefted twice already.

    Comment by Chris Desmond — Mar 18th 2008 @ 12:26 pm
  4. What about when the name on the credit card clearly doesn’t match the person, ie, a clearly gendered name being used by a person of the opposite gender? Or if the person is clearly too young (younger than 10 years old) to be using a credit card other than their parents’? These used to be issues when I worked at Pier 1 – women would frequently bring in their husbands’ credit cards, but you never know if it’s stolen, or even if it’s revenge shopping in a divorce.

    Comment by Anne — Mar 21st 2008 @ 8:22 pm
  5. If the name clearly doesn’t match the person, the card can be rejected. I’m not sure of the legality of this, but as a cashier, I have taken the card and put it in a safe place until the owner came to claim it.

    Comment by Nathan — Mar 22nd 2008 @ 2:27 pm
  6. isn’t this the whole point of the visa commercial where a person takes too long to write a check or a person forgets thier id. ID is the last thing they “need”. if its a froudulent transaction and they have followed the proper proceedures like verifying the signature, then visa/mc or amex is on the hook, not the merchant or in most cases the customer. another way 1% of the population who lie cheat and steal make it hard on the rest of us.

    Comment by Robert V — Sep 19th 2008 @ 2:39 pm
  7. Regarding comment by Robert V:
    I work at a c-store, and each month we are sent a list of transactions that the card company will not pay because the cardholder said they did not make that purchase; in this event, we must prove that it was, indeed, the cardholder who bought the items in question. Without ID, the customer is long-gone and able to refute charges all day long. We have no recourse but to eat the cost of the inventory. We also were forced to implement a store policy of a three dollar minimum for card transactions because we are a small franchise store with limited buying power, and people frequently came in and purchased a cigarillo at .64 while the debit card (MC or Visa) charges us .35 per transaction. In reality, we just paid someone to buy our product. The same holds true with lottery transactions; we make .01 on the dollar, but the card company charges us .35 for the transaction. Policy be damned, we are not in the business of giving away inventory – or worse – paying someone else to take it. Respectfully, jeannie.

    Comment by jeannie — Jan 24th 2010 @ 9:15 am
  8. due to rules of this matter that many small business don’t take credit card. I’m a manager at a small retail business and we required id for EVERY credit card transaction due to the fact that if we receive any transaction that was denied by any credit card company we get charged a fee of $35 dollars. So if we make a sale on a credit card of $10 and is not honored other than the 2% we get charged for every credit transaction we also get charged $35 dollars even if later the credit card company still decides to pay for the $10 dollars. We also apply a 75cents charge to either credit or debit transactions since we are charged 2% on every credit card transaction and about 67cents on every debity transaction. I’m not against the customer rights but the law for the business rights are completly misleading and not helpful to the business. You must all remember that in the moment that a business has a low or no profit the ower simply decides to close the business causing not only the customers but also the employees to suffer. Also having in mind that these details that I shared here are from a small business being much different from big companies such as Vons, Target, etc.

    Comment by Al — Mar 7th 2010 @ 4:39 pm
  9. and also RobertV is very clear that you have never worked at a retail shop if you think only 1% of population lie cheat and steal is more something around 40%. You must understand that retail business ask your id for the business but also your safety. A person can easily steal your card information through gas station pumps, bank doors that required a card to go in or simply the internet and use your card for a month straight untill you notice. And then you know what is the business right to not take blame for that since the customert refused to show his id saying that was against the law. Think about the whole picture just because it never happen to you doenst mean it never will.

    Comment by Al — Mar 7th 2010 @ 4:51 pm
  10. In some states, such as Washington state, there are laws that trump visa/mc rules and allow a merchant to request ID to use the cards. The expectation is that by requesting ID the merchant can prevent a card from being used fraudulently.

    Writing “see ID” or “request ID” on your card unfortunately does not make the card valid. Some merchants will make you sign the card if it doesn’t already have a signature. I know this is rare, but it can happen. The bank even says, when you receive the card, that the card must be signed for it to be considered invalid. If you put your signature and them cram in words to the effect of “see also ID” that is acceptable. However oftentimes the signature space is too small. In that case sign the card and then use a black sharpie (permanent marker) to write “see also ID” somewhere else on the card.

    Comment by Marc — Sep 4th 2010 @ 5:01 pm
  11. If the card says NOT VALID UNLESS SIGNED. That means ASK FOR ID is not a signature. I have had many banks tell me to cut up the card, and the bank promptly canceled the card for the customer. When the customer gets mad at me, I tell them they must follow the rules of the bank.

    Also we almost lost our contract for Visa/MasterCard because an employee asked for Id from the VP of MasterCard! You CAN’T ask for ID! No matter what, you will get paid from them. AX is the ONLY card that is not transferable.Many Store branded cards are the same way. IE: Jane Doe can’t use an AX card with the name Jon doe.

    Comment by Rick Adams — Oct 1st 2010 @ 8:36 pm
  12. Asking for ID is the presumption that you who are presenting the card is trying to defraud the store.

    I live in NYC and I refuse to provide ID; and if the store makes this a condition of my purchasing the items, I immediately report that store to VISA.

    Thus far I have reported two national chains within the last 4 months.

    Comment by Justin — Jul 11th 2011 @ 1:04 pm
  13. The states of Oregon and Washington were concerned enough about fraud to enact the following:

    Oregon Statutes – Chapter 646A – Trade Regulation – Section 646A.214 – Verification of identity in credit or debit card transactions.
    (1) A merchant that accepts a credit card or debit card for a transaction may require that the credit card or debit card holder provide personal information, other than the personal information that appears on the face of the credit card or debit card, for the purposes of verification of the card holder’s identity. The merchant may not write the information on the credit card or debit card transaction form.
    (2) This section may not be construed to prevent a merchant from requesting and keeping in written form information necessary for shipping, delivery or installation of purchased goods or services, or for warranty when the information is provided voluntarily by a credit card or debit card holder.
    (3) Any provision in a contract between a merchant and a credit card or debit card issuer, financial institution or other person that prohibits the merchant from verifying the identity of a person who presents a credit card or debit card in payment for goods or services by requiring or requesting identification is contrary to public policy and void.
    Last modified: August 7, 2008

    RCW 19.192.020
    Verification of identity by merchant/retailer — Prohibition on verification void.
    (1) Any provision of a contract between a merchant or retailer and a credit or debit card issuer, financial institution, or other person that prohibits the merchant or retailer from verifying the identity of a customer who offers to pay for goods or services with a credit or debit card by requiring or requesting that the customer present additional identification is void for violation of public policy.

    (2) Nothing in this section shall be interpreted as: (a) Compelling merchants or retailers to verify identification; or (b) interfering with the ability of the owner or manager of a retail store or chain to make and enforce its own policies regarding verification of identification.
    [2003 c 89 § 2.]
    Findings — 2003 c 89: “The legislature finds that financial fraud is too common, and that it threatens the safety and well-being of the public by driving up the costs of goods and services and unduly burdening the law enforcement community. Further, the legislature finds that financial fraud can be deterred by allowing retailers to verify the identity of persons who seek to pay for goods or services with a credit or debit card. Finally, the legislature finds that some retailers are deterred from verifying their customers’ identity by contractual arrangements with credit card issuers. The legislature declares that such contracts violate the public policy that all citizens should be able to take reasonable steps to prevent themselves and their communities from falling victim to crime.” [2003 c 89 § 1.]

    Other states may also have done this so if you own a business it might be worth spending some time researching it.

    Comment by Sandy S. — Oct 29th 2012 @ 4:27 pm

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