Credit Card

The modern payment card emerged in the United States in the middle of the 20th century. In 1950, Diners Club introduced a card that could be used to pay at a group of participating restaurants and businesses, rather than carrying cash for every purchase. The idea soon spread to banks. In 1958, Bank of America launched BankAmericard, a card designed for wider everyday use. It later became part of the Visa network.

Other networks developed as well, including the organization that became Mastercard. At first, these cards were mainly made of paper or embossed plastic, and merchants often used mechanical devices to copy the raised card number onto a sales slip. As the system expanded, cards became easier to use and payment networks took on a larger role in authorizing transactions and connecting merchants with financial institutions.

Technology gradually transformed the card. Magnetic stripes allowed information to be read electronically, while computer networks made it possible to check transactions more quickly. From the 1990s onward, chip cards based on EMV technology became increasingly common. Instead of relying only on information stored in a magnetic stripe, the chip can generate transaction data designed to make many forms of fraud more difficult.

Contactless cards later added another option: a card can communicate with a compatible terminal over a very short distance, using near-field communication (NFC). Today, a payment card can be used in shops, online and with digital wallets, although the exact security checks depend on the payment method, the country and the financial institution. The card itself does not necessarily contain money; it provides access to a payment system linked to an account or credit arrangement.