| Credit cards have nowadays insinuated themselves | | | | the Access card in competition with Barclays, and for |
| into all corners of our lives, and it is rare for an adult | | | | the next decade or so this remained the status quo. |
| these days to not carry at least one card. As well as | | | | It was during the 1980s that the credit card industry |
| being used in the traditional manner to buy goods or | | | | began consolidating behind the two big processors |
| services in person, they are also now used online, | | | | that had evolved into their current form by this time, |
| over the telephone, for writing checks, and even for | | | | Visa and Mastercard. Banks dropped their own |
| withdrawing money from cash machines. People use | | | | processing facilities, and began to issue cards that |
| them in all sorts of ways - as a means of borrowing, | | | | could be used at any outlet that supported these |
| as a convenient payment method, and even for | | | | two main payment processors. It was this move that |
| earning money through cashback or reward schemes. | | | | led to the great expansion in card use, as they could |
| Despite their ubiquity in modern life, credit cards have | | | | now be easily used almost anywhere in the world. |
| a fairly short history, with the first general purpose | | | | The next major change to the industry was the |
| credit card being introduced less than fifty years ago. | | | | revolutionizing technology of the internet, allowing |
| In this article we'll look at the origins of credit cards, | | | | purely online cards such as Egg in the UK to offer |
| and then at how they've developed over the years | | | | attractive benefits to the cardholder at low cost to |
| with the emphasis on the United Kingdom market. | | | | the issuers. Competition between lenders quickly |
| The very first credit card was launched by Diners | | | | heated up, and features such as balance transfer |
| Club in 1951, and was limited to use in twenty seven | | | | offers began to appear. |
| New York restaurants. It wasn't a huge success | | | | Balance transfer deals allowed cardholders to move |
| initially, with only 200 cards being issued. The real | | | | their debt from card to card and avoid paying any |
| story of credit cards began in 1958 with the | | | | interest on it almost indefinitely, or so it seemed. |
| introduction of two major new products. The first | | | | Unfortunately, this ruse of 'credit card surfing' couldn't |
| was the American Express charge card, which | | | | last as it was costing the credit industry billions every |
| boasted over a million users within five years of it | | | | year, and so a balance transfer fee was imposed |
| being launched. | | | | which made it much less attractive to cardholders. |
| The other innovation was the first example of what | | | | The last major change in the credit card industry has |
| we now recognize as a credit card: the Bank | | | | been the introduction of Chip and PIN technology |
| Americard, a general purpose card developed by | | | | which has cut card fraud substantially by requiring |
| Joseph Williams while working at the Bank of | | | | payments to be approved via entering a code |
| America. Over time, this card was to develop into | | | | number rather than relying on a signature. The |
| the Visa company that we know today. Eight years | | | | technology began to be rolled out in the UK in 2004, |
| after the introduction of this card, fourteen U.S. | | | | and is now fully in use across the country. |
| banks formed an alliance to launch a rival to the Bank | | | | What's next for credit cards? Only the issuers know, |
| Americard, named Interlink, which was to evolve into | | | | but with record levels of debt many people are |
| the Mastercard payment processor by 1979. | | | | reluctant to apply for new cards, and so we're likely |
| The first UK general card was launched by Barclays | | | | to see more attractive features becoming available |
| Bank in 1967, and their Barclaycard is still one of the | | | | to new applicants as credit companies compete for |
| most popular and widespread cards forty years later. | | | | the shrinking amount of business available. |
| In 1972, four other UK banks joined forces to launch | | | | |