Cash was still king in 1949 when Frank X. McNamara, head of a New York City financial company, hatched an idea for harried businessmen who had to pick up the tab for entertaining clients: Use a charge card instead of currency. Americans were familiar with charge accounts at individual department stores, but McNamara’s Diners Club card (originally made of paper) would be accepted by many different businesses, like restaurants and travel and retail outlets. Consumers signed on in droves: Diners Club membership climbed from 20,000 in 1951 to 200,000 in 1955. The company monopolized the credit card industry until 1958, when BankAmericard (Visa) and American Express (which issued the first plastic cards) came on the scene. Master Charge (MasterCard) followed in 1967 and Discover in 1986. Today, there are 10,000 credit card transactions per second worldwide.
Originally published in the February 2010 issue of American History. To subscribe, click here.
