Where Credit Cards Came from

Do you think that the credit cards have always been issued by banks? However, when you explore the history of plastics at greater length, you will find out that the first cards were owned by restaurants and department stores. Actually, the cards of the first generation appeared at the beginning of the twentieth century and they were cardboard! Basically they were used by the wealthy clients as a closure of a deal. Moreover, cards became one of the main components of so-called "loyalty programs". In 1920s not only department stores and restaurants, but also gas stations began to offer credit cards. But cardboard did not seem to be kind of suitable material for these cards, so issuers decided to change it. Consequently, the next output of cards involved metal. These were produced by the company Farrington Manufacturing. Along with this some attempts to automatize the process of card identification were made via embossing some necessary customer-related data on a card. When a customer was effecting a purchase, shop assistants used a special "slip" (check) to imprint the data of a customer's card on it. It should be mentioned, that this technique is still practiced. The international standard ISO 7811-3 (this one is related to credit cards) contains the name of Farrington Manufacturing. Look at embossed letters on your plastic - this font is named Farrington 7B. The growth of the industry starts in 1950, when Alfred Bloomingdale launched his program "Dine & Sign" in Los Angeles. Moreover, the like program was initiated by Frank McNamara in New York. They wanted to use metal cards as well, however eventually they did not implement this idea, so they continued using cardboard. In 1957 the process got more rapid. Companies used absolutely various methods to attract customers. Gas cards got very popular at that time. The situation was even more complicated, when major companies, such as American Express, got involved in his process, along with banks merging to make up companies which later will be known as Visa, MasterCard, etc. Then someone (history is silent about this person) decided to use plastic for making credit cards. The issue was the material for making the cards. The manufacturers needed safe, strong, but flexible (for embossing numbers on a card) material. Besides, it needed printing processing anyway. They tried to use both polyether and polyvinylchloride. Eventually, the first plastic credit card was born - the very plastic we use almost every day. Well, it is not a simple piece of plastic. Now it is also a tool of high technology. Plus, it is a distinctive channel of data exchange - either international, or internal. Actually, the use of a credit card implies a certain system of agreements between companies (or within the bounds of one company) or international agreements. Dinners Club, founded by McNamara and Bloomingdale, was bringing in return about $61,000. Various competitors began to enter the market in 1958. At first these were some companies belonging to non-bank spheres (such as Hilton or American Express). Later Bank of America also joined in. Here begins a very complex and booming development of credit cards. Financial directory