We will see in this article the credit card history. One of the most important financial documents of recent years, do not miss it.
credit card history
The first credit cards made their appearance at the beginning of the 1914th century, when the first card produced by the Western Union company appeared in XNUMX. The company arranged for the creation of a card in which its clients could access a line of credit where they made their shipments on credit.
This Promotion was intended for Preferred Customers only. The system worked for a few years until, little by little, other companies began to issue credit cards. In the early 1920s, the General Petroleum Corporation issued a credit card that was only used to dispense gasoline.
In 1929, American Telephone & Telegraph issued the Bell card, in which customers could access preferential calls if they presented said card. By the 40s, the issuance of credit cards skyrocketed and a real boom began in the country.
What was the first credit card?
To know everything related to the history of the credit card, it is necessary to know what was really the first card that came out for public use. As we have seen, the first cards were issued in 1920.
The first credit card as we know it today emerged in 1949 when a situation occurred in a restaurant called Major's Cabin Grill that allowed the credit card with the benefits we know today to be invented and made operational.
It turns out that Frank X. McNamara, the owner of the company «Hamilton Credit Corporation» was having dinner at the restaurant one day, with him were his lawyer and the grandson of the owner of the famous American company «Bloomingdale's».
Over dinner they were discussing a problem that had occurred regarding a loan from one of Mr. McNamara's clients. That client had gone into debt due to an act of kindness that he himself had performed.
The client had given all his payment cards to other neighbors who had financial problems. Having no funds, the client decided to go to Mr. McNamara in order to apply for a loan and thus be able to cover his expenses.
Before finishing dinner, Mr. McNamara decides to leave, so when he was going to cancel the dinner, it turned out that the money had been left at home. This situation led to the situation of having to call his wife at home and tell her to bring the money.
Diners Club
At that moment the light bulb went on and he thought about the situation of the client who had gone to request a loan from his company, and not to go through a situation like that at another time. He told his dinner companions that if they combined both situations, a card could be created where people could cancel their dinner at any establishment without having to carry cash.
The idea took shape and between the three customers who dined that night they invented a card and called it Diners' Club. At first the card was called the "Club of Senators" and it did not have much impact on American society. By 1950 only 15 restaurants had joined the Diners' Club card payment system.
It also had only about 200 affiliated clients where only friends and relatives of McNamara group together. A few months later the card had such an impressive rebound that in a period of 6 months it had more than 20.000 affiliated customers and the number of establishments had quintupled...
Eye
This card was the first to have features similar to those we know today. The negotiation model consists of obtaining intermediaries between the establishment and the buyer. This charged a commission for the transaction and another for maintenance.
We invite you to reinforce the information on this topic by reading the following article Financial interest rates . However, in its beginnings, the maintenance of a credit card was barely 3 dollars a year. Of course, with a caseload of 100.00 clients, the business was created.
Evolution
Observing the success of the Diners' Club, many banks decided to invest in the business and throughout the country they began to issue thousands of credit cards, which they offered to customers, who could use them not only in restaurants but also in other establishments.
The first banking entity to issue a Diners card was Franklin National Bank of Long Island, located in New York City, in 1951. Subsequently, other entities issued credit cards offering various types of services.
American Express
For the year 1958, its American Express card came onto the market, which belonged to the company with the same name (and today it remains), offering additional and superior services to those offered by Diners Club. American Express changed credit card history when it began to offer, among other things:
- twists to travel
- travelers checks
- A special card which could be used anywhere in the world.
- Access to cash at any bank agency.
All these benefits were guaranteed by the Bank of America. By 1965, this bank had reached agreements with other banking entities outside the state of California, in order to market the issue of the Bankamericard card.
Mastercard
This card had a notable impact on the financial activities of the United States during the 60s. This caused other banking institutions in the northern country to form an association to create the Master Charge card. A few months later it would be renamed MasterCard
In the early 70s, there were more than 1400 banks in the United States offering various credit cards to customers. What led to a wave of promotion that spread to the European continent.
80's onwards
By the end of the 70s, credit cards had become the boom of society, people's lifestyles were changing, borrowing was a fashion, as long as they could acquire goods and services on credit.
At the beginning of the 80s, Bank of America renounced the administration of American Express cards. It is then decided before the various corporations that issued it that they should create a more liberal card but one that would not bear the Bank of America name.
Visa
They then decide to issue a credit card to distance themselves from Bank of America and call it VISA. This card was a little lighter than its predecessors and a way was sought to target it towards the middle class. Diners and American Express were geared towards a more classified audience.
VISA changed the credit card history worldwide and allowed access to credit services and the opportunities provided by credit cards to many middle-income people. But he also directed his policies to financing for the development of banking institutions, we invite you to read the following article Financial Freedom, which contains information related to this topic.
Today the movement of financial entities is carried out digitally, the procedures are carried out through technological platforms that allow access to goods and resources from anywhere in the world.