These days, credit cards are a part of everyday life, but very few people know where this useful piece of plastic originated from. One theory is that initially it was called a “Charge-It” and invented by a banker called John Briggs. Of course, the card was only valid for people who had accounts at the bank where Briggs worked, and it could only be used for local purchases.
Unlike modern credit cards the user was also required to pay the bill in full at the end of the month. Others claim that the founder of Diner’s Club, Frank McNamara came up with the idea to issue credit cards so customers could pay their restaurant bills with it. According to legend he thought of the idea because he forgot his wallet when he went dining at a restaurant.
From Humble Beginnings
Even after the idea of credit cards caught on they were generally still only used by stores as a way to foster customer loyalty and were only valid at certain stores. Of course, the use of credit predates the use of plastic cards and many goods were traded based on this concept.
Even up until the early 1960s some stores still used something called a “Charge Plate” which, according to the American Credit Card Collector’s Society , held the name of the issuer and signature of the cardholder on the back while the name and address of the customer was embossed on the front. Even when credit cards gained popularity they were still made from celluloid or even cardboard until American Express made the switch to plastic.
Becoming a Part of Life
Believe it or not, it wasn’t until the late 1980s that American Express issued a card to customers that allowed them to pay off the sum over a period of time instead of on a monthly basis! Today, credit cards are more popular than ever, and according to Reuters , the average amount of credit cards owned was three back in 2012. Interestingly, about 15 percent of people have more than seven credit cards although, surprisingly enough, this is not something that will automatically hurt your credit score. Generally though, owning too many credit cards is often more hassle than it is worth.
Although the temptation to rack up insurmountable debt by using credit cards is often very big for some people, there are plenty of online resources such as Money Tips that can help people to keep their finances in check. After all, the purpose of a credit card is to make your finances more convenient and not cause you more stress.
With the popularity of credit cards today it is hard to imagine that back in the late 1950s, Bank of America had to mail 60,000 unsolicited credit cards to people in the hopes of the idea catching on. The bank lost a lot of money in the process, and such a stunt would, of course, be illegal today, but there is no denying that the concept of credit cards has definitely caught on.