e-Business Opportunity - Credit Cards                                         

 A credit card is a system of payment named after the small plastic card issued to users of the system. In the case of credit cards, the issuer lends money to the consumer (or the user) to be paid later to the merchant. It is different from a charge card, which requires the balance to be paid in full each month. In contrast, credit cards allow the consumers to 'revolve' their balance, at the cost of having interest charged. Most credit cards are issued by local banks or credit unions, and are the same shape and size, as specified by the ISO 7810 standard.

When you are choosing a credit card, there are many features — and several kinds of cards — to consider: Fees, charges, interest rates, and benefits can vary among credit card issuers. As a result, some credit cards that look like a great deal at first glance may lose their appeal once you read the terms and conditions of use and calculate how the fees could affect your available credit.

Credit cards got their start in the United States just before the beginning of World War I. Department stores began the practice of issuing dog-tag style metal plates to their favorite customers. By 1924 gas credit cards appeared on the scene, the first cards that could be used at merchants all over the country. This was an important advance, because as automobiles became more common so did traveling, and a gas card that was not accepted away from home had limited value. Indeed, the increasing mobility of the average person is one very important reason that credit cards have exploded with popularity. For example, a merchant in California night not accept a personal check from a customer but would take an American Express or MasterCard without hesitation.

With the onset of the Great Depression, as well as World War II, travel and buying were heavily curtailed. Tires and gasoline were rationed, and government controls on credit were put into place. Then came 1950 and the inception of the Diners Club. The operator of a small loan company in New York City, Francis McNamara, came across a man who had a large number of department-store credit cards.

In 1951 Franklin National Bank of New York created a credit card which could be used at many different types of merchants (at this time Diners was limited to restaurants, hotels, and air travel expenses). Other banks began their own programs, and then the very large Bank of America in San Francisco started its own card, the BankAmericard, which has evolved into the modern-day Visa card. Other California banks implemented their own programs, which later became the MasterCard of today.

Crimes that croped up wiyh credit card system and other problems stemming from the relentless card-pushing by banks led directly to the passage of the Fair Credit Billing Act of 1974 as well as many other laws designed to protect the consumer.

 

 

 

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