Editorial

About credit cards and extra ID

Further to the blurb about credit cards and additional identification that appears on Page 9 of last week’s edition of The Leader:
You could say the local man who is refusing to show his driver’s license when using his Royal Bank VISA card is making a fuss about not very much. If fraud is happening – and no doubt it is – why should honest customers object to a bit of precaution on the part of merchants?
That’s not a bad question but there are other not bad questions too. For example: what do merchants have to gain by refusing to serve customers who refuse to show additional ID? And if VISA really does insist that its cardholders don’t have to produce extra ID, or at least that they can’t be refused service if they refuse (VISA has told both things to the fellow in question), why don’t the companies seem to know it?
Why is even the bank issuing the card confused?
VISA has been known to brag that its card is ‘as good as cash.’ If so, it should be accepted with no more assurance than the signature on the back. Of course such a liberal system can be taken advantage of, and is.
It is, but VISA covers the bogus purchases. That’s the cost of doing business, and VISA is doing plenty of business and no doubt making healthy profits all over the world.
Think about it. If VISA (and other cards like it) did not cover the cost of purchases that cardholders said they never made, people would stop making VISA purchases. The whole system only works because the credit card company is willing to eat the fraudulent stuff. They’re making millions, if not billions, based on cardholders’ willingness to share their card number over the phone and online. It’s a system ripe for fraud, yet it must be more than worth it for VISA, in spite of the theft that goes along with it.
So, if VISA is willing and able to support purchases made with no ID at all, why would any business make a fuss about asking for extra ID from someone standing in front of them at a store? If it’s fraud, VISA pays. Period. Unless we’re missing something.
But of course VISA would rather not pay. So it probably doesn’t really mind stores cracking down on fraud by demanding photo ID. Hence the confusion about VISA’s rule against doing that, even at fairly high levels in the RBC, where our friend sought clarification.
As in many situations in life and business, there’s one set of official rules and then how things really work. Sometimes they don’t seem to have much to do with each other.