Economy and Finance
82 Credit Cards
Matthew Quina
Introduction
Ever since credit cards were introduced in the mid-20th century, they have become an essential piece of technology for consumers worldwide. In today’s age, the ability to use credit cards is unmatched in how we spend money by offering convenience and flexibility. Along with these benefits come other significant changes in consumer behavior, typically through compulsive buying and overspending to the consumer (Khare, 2013). These impacts have considerably changed how consumers use our money and spend our hard-earned money. This chapter will examine the social factors that play a part in these behaviors and how they relate to you and the rest of society.
Connection to STS
The study of credit cards and how they impact consumers can be categorized through science, technology, and society (STS). Looking at STS through technological innovations such as credit cards, we can see the influence on social practices and individual behaviors accompanying credit cards. You can assume that many readers of this chapter have used some payment method in the past week. Analyzing how spending money has a considerable impact throughout our day shows how dependent a form of payment like credit cards is on our lifestyle (Hodson et al., 2014). Understanding these connections helps us appreciate the broader societal effects of credit card usage and gives a gateway for addressing the associated challenges.
History of the credit card
Going back to ancient Mesopotamia, the first recorded interaction between a seller and a buyer was able to pay for a product later. The most notable credit card event that resembles today goes back to the 1950s. Frank McNamara and Ralph Schneider introduced the Diners Club Card as the first charge card with significant popularity (Frankel & Lupini, 2024). This card was influenced by Frank leaving his wallet at home while going out to eat. This event would lead to the first modern charge card. The card would work when the customer pays using the card, and the place of service would send a bill to the Diners Club, then send money from the Diners Club to the place of service’s bank. The diner club would make a small amount of money off each transaction, and the customer would have to pay all the bills at the end of the month (Frankel & Lupini, 2024). In 1958, one of today’s primary credit card distributors, American Express, released their first charge card. One of the factors of ease of use of the credit card was invented in the 1960s by an IBM engineer, placing magnetic tape on the back of the card to identify the consumer (Frankel & Lupini, 2024). The consumer would swipe the card, and the place of service would be able to have their information. This would be the invention of the swipe stripe, which would become the standard way to use credit cards, and virtually all cards today have it. In the 1980s and into the 90s, credit cards introduced a way to get consumers to spend more: a