The Mystery of Credit Card

imagesNowadays it’s well known to everyone that credit is a method of selling goods and services without the buyer having cash in hand and a credit card is only an automatic way of offering credit to a consumer. However not all of us is aware of the origin and the history of credit cards. Here we’ll try to illustrate the basics and main functionality of these cards.


Though the roots of credit cards go back to 1890 in Europe the data of Encyclopedia Britannica show that credit cards were originated and firstly used in the United States during the 1920s, when individual firms, such as oil companies and hotel chains, began issuing them to customers. Early credit cards referred to sales taking place between the merchant who offered the credit and his customer.


It was nearly in 1938, that companies started to accept each other’s cards. When we speak of the early credit cards we shouldn’t imagine them in the same way as they exist at present. They were not always made of plastic. It was possible to come across those made from paper, fiber, metal plates and metal coins.

The first bank issued credit card was invented in 1946 by John Biggins of the Flatbush National Bank of Brooklyn in New York. He created the “Charge-It” program between local merchants and bank customers.

By 1960s a lot of companies offered credit cards considering them a time-saving device rather than a form of credit.

The “Overview of Recent Developments in the Credit Card Industry” (2005) states that though credit was first provided for agricultural and durable goods it soon began to spread to other industries as well. In the same way hotels and department stores started to present their valued customers with paper identification cards.

 The Role of Credit Cards in Our Life

iowa-card-fraudNow the role of credit is great and the transactions made by it are innumerable. Credit is accepted as borrowed money which can be made available to you,  if you are ready to repay within an agreed amount of time. You should note that a credit card differs from charge card according to which you should pay the balance at the end of the month.

Your ability to repay the borrowed money is of utmost importance to get a credit card. Each lender is very cautious about giving money to a risky borrower. That’s why borrower’s credit report is taken into account.  The latter represents an essential instrument for lenders to decide whether to loan money or not. It gives the whole image of your credit history. All your credit accounts, the account limits and balances as well as the repayment history are mentioned there.

Due to credit cards you do not have the necessity of carrying cash or checks. On a plastic card you can see your name and a series of numbers showing the applicable network, bank and account. These numbers are accepted as the “card number” or “account number”. Card’s expiration date and the issuer’s logo are also presented and in some countries it’s even accepted to include a photo of the card holder for security.

Nowadays due to the credit cards you can easily reserve a hotel room, airline tickets and concert tickets; it’s possible to perform online trading activities via this kind of payment system, as well as replace lost or stolen items in person, over the phone or through email. In other words you can use them almost everywhere.

Daniel Moore

Daniel is the one responsible for most of the business related articles. He is a serious person very keen on gathering information and being the first to know about all the latest news there are in business world. He is friendly and open person happy to help in case of difficulties.

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