[mva]

I think he meant that the actual conversion to a paid customer. Of course you will get more sign ups (we saw the same at Usabilla), but that doesn't mean those additional sign ups will convert into a paid customer.

We have seen as well that there is less dedication from a customer when they sign up without a credit card. People sign up and forget about it, because it isn't paid anyway (even when you send them regular update emails). When requiring a cc for sign up the user is more motivated to actually trial the product and see if there is a fit.

It basically shifts the drop by sign ups from the actual users who want to use your product for a longer period.

Above is all from B2B experience. B2C can be totally different.