This month in history: the first credit card
What: Bank of America launches its first credit card
When: September 18, 1958
Where: Fresno, California
While the first half of the 20th century saw consumers use payment cards, like Diners Club, to make purchases and later pay off balances, Bank of America was the first bank to launch a high-volume card program. scale offering consumers a revolving line of credit.
BankAmericard launched what became known as the “Fresno Drop”, a mass mailing of plastic credit cards to 60,000 residents of Fresno, California. Residents received no notices about the cards, but more than 300 merchants had agreed to accept BankAmericard before the cut. Mass mailing of credit cards would later be banned in the United States
While encountering fraud, consumers who decided not to pay and other problems as the cards were distributed to more Californians, Bank of America began to profit from credit cards within three years. BankAmericard will become Visa in the 1970s.
“Here began the trickle of what we now call ‘financial products’, largely aimed at the middle class, which would, by the 1980s, become an avalanche. This was the first glimpse of the gradual but enormous changes in the habits and financial assumptions of the middle class. … Although this transformation will only become apparent in 20 years, and although it continues to this day, it was then that the American middle class began to change the way they think and manage their money .
—Joseph Nocera in a 1994 Washington Post article adapted from his book “A Piece of the Action: How the Middle Class Joined the Money Class.”
To celebrate its 150th anniversary, Banker & Tradesman is highlighting important moments in the history of Massachusetts’ real estate and banking industries. To suggest a topic, send an e-mail [email protected].