What is the origin of the credit card?

The history of credit cards is a fascinating account of how payment methods have evolved in the modern world, revolutionising the way people shop and manage their finances. Credit cards, as we know them today, are the result of a long process of innovation in the financial system.

Its origins date back to the 20th century.when the first forms of credit began to take shape, although the concept of credit has been around for thousands of years. Merchants and moneylenders offered credit to their customers to facilitate trade, but it was only in the last century that standardized credit systems were developed.

The true origin of the modern credit card dates back to the 1950s in the United States.with the creation of the first universal credit card by Diners Club in 1950Before this, there were already credit cards issued by stores and gas stations, but they could only be used in the establishments that issued them.

Diners Club changed this model by offering a card that allowed users to make purchases in multiple restaurants and establishmentsmarking the beginning of the era of credit cards as a widely accepted form of payment. Originally intended for businessmen, this card allowed them to pay their bills at restaurants and then settle them in a single payment at the end of the month.

This innovation facilitated the Access to credit for millions of people and contributed significantly to the expansion of consumption in the following decades.

In those same years, another major competitor appeared on the market: American Express. Although American Express was originally known for its transportation and courier services, In 1958 he launched his own credit cardwhich quickly gained popularity, especially among travelers and high-net-worth individuals.

The Key Difference Between American Express and Other Credit Cards of the time was that this operated like a charge cardwhich meant that users had to pay the full balance at the end of the monthinstead of making partial payments with interest.

The 1960s It was a period of rapid expansion for credit cards. In 1966, several American banks formed an alliance that would later give rise to Mastercard, a payment network that would compete with Visa.

As more banks began issuing credit cards and more merchants began to accept them, the credit system expanded rapidly throughout the country and eventually globally. This period also saw the development of technologies that improved the security and efficiency of cardssuch as magnetic stripes, which allowed payments to be processed more quickly and securely.

In the 1970s and 1980s, credit cards became a global phenomenon.. Major payment networks such as Visa and Mastercard They expanded internationally, establishing connections with banks around the world and allowing people to use their credit cards in any country.

During this time, credit cards began to Offer more than just the convenience of deferring payments; rewards and points programs, as well as additional insurance and benefits, became key tools to attract more users. This made credit cards consolidated as an essential part of financial life of millions of people around the world.

With the arrival of the Internet and e-commerce in the 1990s, Credit cards have taken on an even more important role in the global economy. As online shopping became more common, credit cards became the preferred payment method due to their speed, security and ease of use.

Companies like PayPal and other digital payment processors emerged, but credit cards remained one of the primary tools for making online transactions. In the 21st century, credit cards have continued to evolve with the introduction of technologies such as EMV chips and contactless paymentswhich increase the security and convenience of transactions.

In addition, the Fintech and digital banks have begun to offer new forms of credit, such as virtual cards and instant credit services, which has further changed the payments and credit landscape. Credit cards now offer a wide range of benefits and additional servicesfrom access to VIP lounges at airports to accumulating miles for travel.