Could Visa’s New No-Signature Rule Hurt Contactless Payments?
Digital Transactions February 11, 2010 Visa Inc.’s announcement this week that starting this summer it will no longer require signatures for transactions of $25 or less at most U.S. merchants heralds a policy that will result in faster and smoother transactions but could also undermine the payments industry’s move toward contactless technology. “The merchant proposition [for contactless] is pretty much negated at this point,” says Nick Holland, a senior analyst at Boston-based Aite Group LLC who has closely followed contactless payments. Under Visa’s new policy, which takes effect in July, about 98% of more than 800 U.S. merchant categories logged in Visa’s system will be eligible to accept Visa cards issued by U.S. banks without a signature for tickets at or under $25, up from about 3% currently. That will open the signature waiver to hundreds of thousands of additional merchants, including such categories as discount stores, according to Visa. The move extends Visa’s current no-signa
