Do You Really Have to Show ID When Using Your Credit Card?

Shopping ID Card

In a MyBankTracker story about the antiquated process of signing your name after making a purchase with your credit card, a reader left a comment that pointed out the rules for showing your ID when using a credit card to buy something.

I like to think that I'm an informed consumer, and like many, I want to know what my rights are when I make purchases with my credit card.

Do stores really need to see my ID, and, why? Is my personal information in danger when I hand my ID over?

My curiosity led me to an area where asking for ID is a normal occurrence: New York City's busy SoHo shopping district.

This past weekend, my friend and I walked along Broadway in search of a new pair of sunglasses.

When my friend was ready for her purchase, she handed over her credit card to the sales clerk, who then asked for my friend's ID.

Now, knowing my rights as an informed consumer, I interjected and asked what the clerk would have done if my friend didn’t have her government ID.

“I would have asked for anything else that has her name on it -- it doesn’t need to have a photo,” the clerk responded.

I have a feeling most customers probably aren't aware of this, as I've never seen anyone refuse to show ID when making a purchase.

Piquing my interest, I asked if a library card or health insurance card would be enough. She replied, "Definitely."

My final question was, "What if a person didn't have any form of ID to verify he/she is the actual owner of the credit card?"

The clerk said, “I would not be able to accept the credit card. It happens from time to time with customers. In these cases, I just tell them to pay with cash -- there’s an ATM right around the corner if they don’t have cash.”

Of course, that's assuming the person is using their debit card, and not a credit card. (I would hope that someone shopping for something small, like a shirt, would not turn to a cash advance at an ATM.)

It’s odd that some stores will ask for an ID while others do not. I have a feeling it's partly due to the fact that the store employees probably aren't informed about the credit card-ID process. That’s why I looked into the rules surrounding the “requirement” for IDs when shopping with credit cards.

Is it legal for businesses to ask for ID?

It is absolutely legal for a business to ask for your ID.

However, card networks have rules that stores must abide by when it comes to dealing with verification -- these rules can vary depending on whether or not your signature appears on the back of your card.

Visa

If the card is signed, the merchant is not allowed to require ID. If the card is unsigned, the merchant must ask that the card be signed and that the customer provides government ID.

MasterCard

If the card is signed, the merchant is not allowed to require ID. If the card is unsigned, the merchant must ask that the card be signed and that the customer provides government ID.

American Express

There is no rule governing the requirement for IDs -- American Express simply wants the merchant to verify that the customer is the actual cardholder.

Discover

Under suspicion that a card is invalid, the merchant can request ID. If the card is unsigned, the merchant must ask for two pieces of ID, one f which must be a government photo ID.

Can a business refuse a credit card sale?

Generally, regardless of whether or not you provide ID, a business can refuse a sale as long as it doesn’t violate any discrimination laws.

So, a store can choose not to process a transaction if it feels that the sale could affect the business in some way (e.g., customer is known for excessive returns or risk of fraud).

It doesn’t matter if you use a credit card or cash -- the store can reject your business.

Should I be worried about privacy?

Privacy is probably a part of the reason that you don’t want to give your ID to a sales clerk.

On your ID, you have personal information -- such as address and date of birth -- that you wouldn’t want in the hands of a stranger.

Although it doesn't happen often, one scary scenario would involve an unscrupulous store employee who steals customer information from their IDs.

This employee can use it to conduct identity theft and apply for credit cards under someone else’s name.

Such criminal activity can happen at all types of business, including medical offices, where you highly value your confidentiality.

Here’s a recent case where a dental receptionist stole patient information, which was used to apply for credit lines at the Apple Store.

More realistically, however, it's more likely that you didn't have your ID with you at the time. If anything, sinister store employees are more interested in your credit card information.

Personally, I don’t mind handing over identification to prove that I am the owner of the credit card.

It’s comforting to know that a clerk is checking that someone didn’t steal my credit card to make fraudulent purchases.

Related Articles

CD Vs. Savings Account: Which Is The Better Option For You?
CDs vs Government Bonds: Which is Better?
Money Market Accounts Vs. CDs: Which is Better?
Are Credit Card Balance Transfers a Good Idea?
What is a CD Ladder and How to Use It to Maximize Yields
CDs Vs. Installment Savings Accounts: Which Is The Better Saving Strategy?

Ask a Question

disqus_9fvzE4YSk2
Tuesday, 12 Feb 2019 4:49 AM
<p>I have shopped at the same walmart many times and yet today when I was checking out the lady suddenly asked for my ID. Now I had my AMEX credit card already in the machine and she told me to take it out and give her my Drivers License as well. I am in my 30's and I had not purchased any alcohol, ammo, compressed air, pseudophedrine etc... anything that would make a computer system ask for my ID. The weird thing is that she seemed to be looking at my husband suspiciously- but when I paid did not ask for his ID. We are white, always shop there together, and are well dressed compared to the general riff raff of the store (Him in a 3 piece suit with overcoat, me in cashmere and fur). Again very odd. I am not sure why she would have done that. Any ideas?</p>
Idadho
Wednesday, 19 Sep 2018 9:12 PM
<p>BUT, My MasterCard agreement says that my MC will be accepted anywhere the MasterCard logo is displayed. It does not have a Must show ID caveat.</p>
craig_gomez
Wednesday, 19 Sep 2018 11:13 AM
<p>I want to clarify a erroneous point you make about the store's exposure to credit card fraud. A merchant who argues that requiring ID is to prevent fraud loss to either you or them is not based on the facts. The process today is guaranteed to cover any loss to either the customer or the merchant. At the POS, you swipe the card or, if chipped, insert into the terminal. One of two things will happen. 1) if there is no hold on the card, a authorization code will display that completes the transaction. Or, 2) if a block has been placed on the card, it will display, "declined". There is no loss to the merchant once the authorization code displays. That code is stored in the stores computer database and can be researched at any future time. The bank or card issuer takes the hit if fraud occurs. Neither the customer or the merchant take the hit.<br>It is important that anyone using credit or debit cards know the terms and conditions of using bank cards. A simple google search will provide you with policies, procedures and rules.</p>
Friday, 07 Sep 2018 8:25 PM
<p>I recently had an issue at a Home Depot requiring ID for purchase so o contacted both Home Depot and MasterCard customer service in order to cover my bases. While Master Cards policy does state that no ID is required when the card is signed, they will still support their merchants whose policies are more stringent. So, you may refuse to show ID however the merchant is NOT required to complete the transaction. This only applies to MasterCard, I am not sure about the others.</p>
craig_gomez
Thursday, 07 Jun 2018 7:00 AM
<p>Regarding the above article, according to VISA MERCHANT AGREEMENT, a merchant cannot require an ID as a condition to accepting a VISA card. Meaning, even if you refuse to show ID the merchant must still process the transaction. IMPORTANT NOTE: that only applies to CREDIT CARDS. Debit cards are different and are never subject to the ID requirement because 1) there is no credit issued. It is money directly debited from customers checking acount and 2) If there is attempted fraud or a stolen card, the bank covers any loss. No liabilty is placed on either merchant or customer. The only exception is unsigned cards.</p>
craig_gomez
Thursday, 07 Jun 2018 6:46 AM
<p>Since we last discussed this, I have been able to research further. What I found is a recent court ruling that allows major retailers like big box stores and other merchants that get a high rate of returns, to require a driver's license or other government issued ID for the purpose of tracking returns made by one customer. It establishes a pattern of fraud if the same customer has a history of returning merchandise for "exchange" or "store credit" which is customary without proof of purchase. No cash refunds will be made without proof of purchase. So, the store was acting lawfully by asking you for ID. However, the question was, does a merchant have the right to require ID subsequent to a PURCHASE. That answer is NO! Returns are an entirely different situation.</p>
johnluyo
Thursday, 07 Jun 2018 5:51 AM
<p>Craig,<br>What law are you referring to that California enacted? and how to report merchant going against it?</p>
disqus_2ensaYxWKk
Tuesday, 20 Feb 2018 4:58 AM
<p>The one that doesn't have a clue is you, ITS a return, Not a purchase which is where most fraud occurs. All you stated is what everyone already knows. Meaningless information provided by you. And yes Nothing will happen by reporting the violation because I also reported Adidas a year ago. What happened? Nothing, no follow up call from MasterCard, Nada. My Drivers license is for law enforcement not Becky behind the counter who now uses my info to get herself a credit card in my name. Wheres the protection in that ?.</p>
craig_gomez
Tuesday, 20 Feb 2018 1:30 AM
<p>It isn't paranoia that has taken over. It is the belief that a "must show ID" policy is for your protection as dictated by the merchant. Capitulation NOT Paranoia. And, the ad you reference was just that. An advertisement to promote the use of Visa Cards. To read more into that and say it creates paranoia is absolutely ridiculous. In the credit card age, banks have set the rules and policy for use and, merchants have established their rules and policy for accepting cards. However, most consumers are not aware of or, bother to read the agreement they signed which explains Merchant policy. I will note for clarity that the Fourth Amendment to the US Constitution with regard to "search and seizure" includes your right to not be forced or coerced to prove your identity. You are never "required" to carry or show ID to anyone including law enforcement. If you capitulate to the demand for ID, you have waived your fourth amendment right and have no claim of protection. In refusing to act, you are asserting your right under the law.</p>
craig_gomez
Tuesday, 20 Feb 2018 1:12 AM
<p>You "suspect that Mastercard will do nothing because they make money from merchants"? Mind boggling. You haven't a clue. First, your obligation to report merchant violations is clear and you signed a written agreement to report any such violations. In that you did the right thing however, Mastercard is a banner under which all banks work with in card sales. IT IS THE BANK THAT TAKES THE HIT FOR FRAUD. They have a vested interest in preventing those losses by establishing rules for merchant and consumer use. To think they won't act on your complaint is wrong. To many people take a casual attitude about the fact that every year billions of dollars are lost and remain uncollected because of fraud. In the end, it will be a factor in your credit report with credit report bureaus.</p>
craig_gomez
Tuesday, 20 Feb 2018 12:56 AM
<p>The point that you are missing is, whether you think it's okay or not, the merchant is violating their written contract which they have agreed to obey. If they are violating such an important condition with you then there are hundreds more customers who, like you' are exposing themselves to IDENTITY THEFT. Frankly, your statement about reporting fraud as being more hassle than capitulating to the merchant's demands is based on a lack of knowledge and, the sophistication of those who steal identity. Moreover, you also would be on the hook if there was fraud usage and you didn't report in a timely manner. One could conclude from your attitude that ignorance and laziness precludes your obligation to monitor activity on your card that is suspicious. You also have a written contract with the card issuer. In the first instance, you are enabling the merchant to engage in the act of stealing identity and in the second instance, relying on showing your ID as a protection against fraud. You are wrong in both instances. And, any loss from fraud over $50.00 will be on you. So, you should reconsider your flawed thinking. The merchant restriction on the demanding to see ID before they agree to accept payment IS a protection to protect you. It is NOT protecting you to SHOW ID.</p>
craig_gomez
Sunday, 18 Feb 2018 11:37 PM
<p>Stephen, thanks for your reply. I spotted my mistake after posting and realized it wasn't your quote. Sorry. And I was never worried. But, there seems to be confusion about DEBIT cards. I have DEBUT not credit. According to Visa's Merchant Agreement specific to DEBIT cards only, a merchant cannot ask for or require a customer to show any kind of ID period. The only exception is if the card bears no signature. The ID signature must be the same as the signature on the DEBIT card. In addition, California enacted a law to protect consumers from IDENTITY THEFT. It is clear that merchants are never permitted to ask for ID under any circumstances. Anyone in California should report those merchants for doing the very act that prompted lawmakers to enact this law. As you state you work for a bank, it should be made clear to those who come to the Merchant Window that because they never have exposure in a Debit Card fraud investigation, there is no reason for them to see a customer's ID. At POS they will see an APPROVED code number that is confirmation of the sale being legal. Even if my son goes to buy food at the grocery store with my card, it would only work by me providing him with my PIN. The merchant is obligated to accept and complete the transaction without requiring an ID. And, he has a signed agreement with VISA that explains everything. Thank you again.</p>
stephenritger
Sunday, 18 Feb 2018 10:59 PM
<p>The first part is not my words. They are quoted from someone else.</p><p>Don't worry, I am very familiar with the laws and regulations surrounding credit cards. I work at a bank. Take care.</p>
craig_gomez
Monday, 05 Feb 2018 10:39 AM
<p>Actually, you are NOT the "owner" of the credit card. The issuing bank IS the owner and retains the right to revoke it's use. You are the "cardholder" and have no claim of ownership.</p>
disqus_2ensaYxWKk
Thursday, 19 Oct 2017 9:59 PM
<p>Tried to return an item to the container store, they insisted on ID and copied my drivers license number into their system. Why do they need drivers license. When I tried to educate them they would say that they can not process the return with the ID. I won't shop there anymore and have filed a complaint with MasterCard. But I suspect mastercard will do nothing because they make too much money from the merchants.</p>
Friday, 05 May 2017 9:15 PM
<p>thanks for the article simon,, since visa cards have been in existence since the 60s, it has never been required that one must produce ID in order to use the card. you are indeed correct that the only time one needs to produce ID is when you may have forgotten to sign the back of the card,, or when state law trumps this (not common). some may in fact remember the popular tv commercials from the early 90s where senator bob dole tries to pay at a restaurant and is carded because he didn't use a visa card,, this asking for an ID thing got popular for some reason within the past 10-20 years in this paranoid society of ours. when I am asked to produce an ID &amp; it doesn't happen often,, I refuse &amp; if they insist I try to educate them. but, the consumer should not have to educate the merchant on their merchant agreement responsibility. it would be nice if visa for example would provide the consumer with something they could use,, on the spot to help them through these situations. I applaud your article in educating people out there.</p>
Idadho
Friday, 17 Feb 2017 1:35 AM
<p>Good point. I should have said fraud with that credit card. Yes, giving them a look at other identification information does create a risk. Seeing your birth date, address, DL No. all can be used to access all sort of credit and financial systems.</p>
ADisqusADosqus
Thursday, 16 Feb 2017 11:31 PM
<p>Of course, it does. The consumer is at higher risk for all types of fraud when more personal information is given to potential crooks.</p>
Idadho
Sunday, 27 Nov 2016 8:43 PM
<p>Showing ID does not change your risk of fraud. It only changes the store's risk of fraud. Showing ID means they can see you driver's license number and date of birth. They can do far more to damage you financially with that information in ways that will seriously disrupt your life.</p>
SimonMBT
Monday, 24 Oct 2016 10:27 PM
<p>True, the net financial damage is $0. I just don't want to bother with reporting and resolving the fraud case. It's a hassle that I would prefer to avoid in the first place.</p>
stephenritger
Saturday, 22 Oct 2016 3:32 AM
<p>"Personally, I don’t mind handing over identification to prove that I am the owner of the credit card. It’s comforting to know that a clerk is checking that someone didn’t steal my credit card to make fraudulent purchases."</p><p>Why would you worry about fraud when you have zero liability for fraud? I don't show ID with a signed card, and if the merchant persists in violating their merchant agreement, I report them to Visa. I have already been successful in forcing merchants to change their policy in order to comply with their merchant agreements. 1-800-VISA-911 works!</p>