Origin and History of Credit Card Offers

Credit cards have a very long and storied history. In the early 1900s, businesses would issue their own forms of credit by giving individuals the ability to pay for purchases at a later date. Unfortunately, borrowers and credit users would have to open a new account wherever they wished to make payments on a charge.

The purest form of the credit card we know today did not come about until 1949. Known as the Diner's Club card, it was a charge card which users could present at restaurants to have the amounts billed to them at a later date. By 1951, the Diner's Club card had thousands of users, and it wasn't until 1961 that the cardboard card was replaced with the plastic card that we know today.

American Express would enter the credit card business in 1959 with the first known plastic credit card. In just five years, more than one million Americans opened an American Express credit card which could be used at nearly 100,000 different restaurants and small businesses. This would be the start of the massive expansion in consumer credit and the start of credit purchases for individuals.

From Charge to Credit

Over time, charge cards (cards which must be repaid in full following the billing cycle) were replaced with credit cards. The move to credit cards from charge cards changed the landscape for consumer finance. Borrowers could now pay for a purchase with a credit card and pay it off in the following months or years after the initial purchase.

More than 600 million cards are now owned by American consumers - that's nearly two for every man, woman, and child in the United States. Americans have also embraced the buy now, pay later lifestyle, with the average household carrying balances of nearly $16,000 on all of their credit cards.