Credit History in the 1900's Essay

1158 WordsSep 24, 20155 Pages
"Credit Card and Credit in the 1900s" Oil Companies and department stores were among the first companies that offered their own cards, which gave their cardholders credit in their businesses in 1900. Before then, American families had established book credit from merchants who allowed the same. Unfortunately with advancement in technology and urbanization in 1900 saw the book credit become infeasible. The first step in the growth and development of credit cards in 1900s was the establishment of store specific metal charge cards in the year 1928 (Mendel, 1990). Anyone with a charge card was able to receive this store credit. The oil companies used the credit cards to increase efficiency in the payment of its services. Furthermore, Oil companies came to make use of these credit cards as a focus to enhance their customer base. As a result, these companies also developed paper courtesy cards for their loyal customers to use them in their stations with balances being paid in full monthly. Standard Oil of Indiana played a great role in the development of credit card by mailing 250,000 unsolicited cards in 1930s (Mendel, 1990). The banks also used these cards to increase their customer base. However, this cards lead to increased money fraud and also people feared that the cards could be stolen hence being charged for the same. As a result, the Federal Trade Commission (FTC) banned the mailing of unsolicited credit cards. As time moved on, gas companies went a mile further and developed embossed aluminum charge cards in 1950s. These cards resembled the size came to be used in 2000s. In 1949, the first bankcard was developed by John Biggins, a banker from Brooklyn and was named charge-it. The bank started using the card following the merchant’s acceptance and passed charge to its customers. For the customers to use the card, they had to open an account at

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