This new feature from popular credit card companies could save you time making small purchases.
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Your next credit card transaction might not require the use of a writing instrument.
In order to encourage the purchase of small items at a faster pace, credit card companies are increasingly permitting consumers to simply swipe their card to pay for items under $25 at drug stores, fast food eateries, convenience stores and pharmacies — no signature required. Credit card companies hope that these no-signature transactions will speed up store checkouts and encourage more consumers to make everyday purchases with their credit cards.
However, consumer groups are concerned that as more small items are paid for with credit cards, the speed and ease of no-signature transactions could leave shoppers deeper in debt.
Consumer advocates warn against such purchases unless the cardholder is disciplined enough to avoid revolving a balance on their credit card from month to month. And, even if consumers are strict about paying each month, these critics note that with more items on a credit card statement, it becomes increasingly difficult to spot unauthorized purchases.
Nevertheless, Visa explains that not having to sign for credit card transactions is a major convenience for consumers and key to the growth of low-cost purchases on credit cards. And credit card companies note that merchants benefit from no-signature transactions, as the ability to serve more customers produces greater overall sales. Also, MasterCard highlights the fact that consumers tend to spend more when they use a credit card versus making purchases with cash.
With no-signature transactions saving credit card users time and making money for the card companies and merchants, the trend will certainly have its share of fans.