You cannot require an ID for a Visa transaction???
January 21st, 2010 in: Fraud, Merchant Accounts
After reading an article this morning, the author states that merchant’s are prohibited from asking for an ID to process a transaction. Sounding completely ridiculous, I decided to further investigate.
I stumbled on a Visa operating regulation that I was not aware of. “You cannot require an ID in order to complete a Credit transaction.” Furthermore, you cannot decline or refuse a transaction if your customer refuses to provide an ID.
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.
The author was completely wrong as far as MasterCard goes, who takes a different approach to the situation…
For unique transactions processed in a face-to-face environment (with the exception of truck stop transactions and card-read transactions where a non-signature CVM is used), request personal identification of the cardholder in the form of an unexpired, official government document. Compare the signature on the personal identification with the signature on the card.
American express is a little vague, but still states that the identity should be verified…
Verify that the customer is the Card-member. Cards are not transferable.
It’s actually hard for me to believe that Visa goes this far in trying to protect their cardholder’s convenience at the expense of their merchants being exposed to potential fraud. I strongly recommend checking the ID of every card holder. No regulation prevents a merchant from asking for an ID, and I can’t imagine a customer seriously refusing under any normal circumstance. Merchants are not allowed to ask for an ID on “PIN” debit transactions where a customer enters their PIN number into a pinpad. For signature debit, where the card is processed like a credit card, treat the transaction just like credit and ask for an ID.
If anyone would like to see the various card regulations, they can be found here:
Visa
MasterCard Chargeback Guide
AMEX
Discover’s site requires registration, and I was unable to register with the Discover numbers of the 4 merchant accounts that we have. If anyone has a copy of Discover operating regulations, I would love to see them.
(Add your own)Comments
The whole idea is for smooth transaction between the card-user/merchant hence a novel method be used keeping this view in mind…i am sure we can get one…
I truly understand the merchants frustration regarding the whole credit card mess. Fees,regulations,charge backs,disputes. We in the credit card processing business need to listen rather than to focus on selling our goods. Try helping the business owner, advertise their business on the radio or local print media. This is what I do for my merchants after all you benefit too. My clients are always happy to see me or talk to me on the phone, a wonderful change after I started this. Google Jay Sumlin and read some of my tips.
Very good post keep going man
Great post!
Are you looking for something like that:
http://www.ncosc.net/SECP/discover/Exhibit-A-Merchant_Operating_Regulations_Release_7.2.pdf
Yes, thanks.
Looks like Discover leaves any language about checking an ID out of their manual. They do require the ID verified if the card is not signed, so I would assume they have a similar although more ambiguous approach as American Express.
There was a story on CNN about this, and they said when contacted all three said you couldn’t require ID as a condition for a transaction.
I just don’t get this, how can you sell someone high end electronics like laptops or the like without ID? Of course it’s up to the merchant to not sell the item, but Visa (at least) making it a requirement…
I’ve never heard of anyone losing their merchant account over it though. Also, there’s places like liquor stores which have to require ID anyway, for them at least there’s no legal way to comply with this policy.
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