History of credit cards

The earliest recorded history of credit cards is found in the 1800’s. Store keepers wanted a fast way of keeping track of customer purchases made on credit. Instead of constantly writing down their customers’ personal information, they issued tokens with numbers on them. When the customer made a purchase the store keeper simply had to write down the token number. The history of credit cards is not all that exciting since nothing major happened for the creation of credit cards to come into being. In 1951 the Franklin National Bank thought of a revolutionary new way of issuing credit to their customers. They created revolving credit accounts which allowed their customers to borrow money, repay it and then borrow again without constantly having to be approved for a loan so long as they stayed under their credit limits. Soon other banks started following in their footsteps and began offering their customers revolving lines of credit. Next the banks started issuing credit cards that could be used to make purchases at local merchants. However, customers quickly wanted to be able to use their credit cards beyond their own localities. That’s when the credit cards now known as Visa and MasterCard were created and formed interchange – a nation-wide money exchange system to act as intermediaries between the banks, merchants and the customers. Needless to say, that the new credit card system was a great success and took firm hold. Today credit cards are a necessity for being able to function. Without a credit history people will have a hard time getting loans from banks, making hotel reservations, renting cars or buying airline tickets. Credit cards have come a long way from being a local commodity to a global entity.