When you receive a new credit card, the strip on the back of the card is blank. This is the spot where you're supposed to sign. While you may do this in haste before stuffing the card into your wallet, the signature on the back of a card is more important than you may realize.
Function
A credit card signature links you to your card. When you make purchases and sign credit card slips, the signatures on the slips and your card can be compared to ensure they're a match — and that you're the true owner of the card. Signatures that don’t match can tip the cashier to the possibility of fraud and prompt her to ask for ID to verify your identity.
Signing
Use a black or blue pen with quality ink to ensure your signature doesn’t fade easily. Sign your name in the same manner you always sign it on the signature strip on the back of the card. Usually, this area is coated with gray or white material and feels different than the rest of the card. While you may think that leaving this area unsigned is best because it prompts merchants to ask for identification, merchants aren't supposed to accept unsigned cards.
Preservation
A signature on the back of a credit card is no good if it’s illegible. If you sign your card and immediately slide it into your wallet, you run the risk of smudging the ink. Rather, wait until the ink is fully dried before putting it away. After using the card, slide it into your wallet with care — repetitively shoving it in and out of a tight wallet pocket can make your signature quickly fade.
Misconceptions
To avoid identity theft and fraud, people sometimes write “Show ID” on the signature strip instead of signing their names. Unfortunately, merchants aren't supposed to accept cards with this memo written in the signature line, so this strategy may render your card unusable, notes a Bankrate article.
Problems
Signing the back of your card doesn’t ensure that you won’t become the victim of identity theft. Not all stores compare signatures on cards to signatures on credit card slips. Additionally, some merchants participate in programs through Visa and MasterCard that allow them to swipe a customer’s card for smaller purchases without the need for signed credit card slips; in these cases, there's no second signature to compare to the one on the credit card. Further, even when a card is signed and credit slips match, not all store clerks check the two, according to Bankrate.
References
Writer Bio
Cynthia Gomez has been writing and editing professionally for more than a decade. She is currently an editor at a major publishing company, where she works on various trade journals. Gomez also spent many years working as a newspaper reporter. She holds a bachelor's degree in journalism from Northeastern University.