You've probably encountered this situation numerous times. You are in a store paying for your purchase with your credit card. The cashier asks to see your driver's license. Do you have to show it? Probably not!

Merchants may ask a customer for identification, but in most situations, a merchant may not condition acceptance of a Visa or MasterCard credit card upon the customer presenting identification.* In other words, you can refuse to provide identification, and the merchant still must accept your credit card. Many merchants are unaware of this rule.

Many consumers feel that asking for ID helps protect them from identity theft while others simply want to protect their privacy and personal security by not revealing their address, birth date, and other information contained on their driver's license to a stranger. If you want merchants to ask for your ID, sign your card and write "Ask for ID" below your signature (however, merchants are not bound to honor that instruction). If you do not want to show ID, simply sign your card and refuse to provide ID if asked.

Be aware that identification may be required for purposes other than the credit card transaction, for example, when purchasing alcohol, tobacco products, or certain drugs. Identification may also be required for unusual transactions flagged during the credit card authorization process.

*According to the MasterCard and Visa Merchant Rules