Deep Dive

The journey of credit cards

Emma Nunes-Vaz
January 16, 2024

Before the existence of credit cards, people were forced to visit banks and ask for a loan which would often come with a very hefty interest rate attached. There was no scientific method behind who was granted the loan, it was purely based on status and whether you could be trusted to repay the loan. What this meant is that access was often restricted to primarily white, middle-class people. It wasn’t until a rectangular piece of metal was created to save the day that people could purchase previously unattainable items.

Credit cards were first introduced in the UK (although America did in fact beat us to it🙄) by Barclays in the 60s, coined as the ‘Barclaycard’. Just over 1 million bank customers were sent these first edition cards until competitors jumped on board in 1972, just 6 years later and launched the ‘access’ credit card. Only a select group of participating stores accepted these cards, and processing the funds from a purchase would take days before reaching the bank and arriving in the consumer's account. At this stage, using the small rectangles of metal was seen as a symbol of status instead of their role today which is in people’s everyday lives. It was in the 80s and 90s that the use of credit cards became more common and public reliance became increasingly apparent.

American origins

Dating back even further in the USA, specifically in 1946, an American banker and inventor named John Biggins introduced a bank card called ‘Charg-it’. It was the first of its time and his aim was to attract loyal customers to his bank. A customer would purchase an item without having to pay then and there. The trader would deposit a slip at the bank confirming the purchase and the bank reimbursed the merchant. The consumer was subsequently billed for using their ‘Charg-it’ card. This continued until competitors noticed its success over 10 years later.

Existence in contemporary society

In modern society, consumers seem to rely on credit cards to enable them to purchase items that they wouldn’t be able to if they were using cash. In November 2022, it was recorded that the average credit card debt per household was £2,290 (Source: The Money Charity)

It was recorded that by 2000, half of the British adults owned a credit card, highlighting how within 40 years of its inception to the market, consumers were desperate for this new ‘solution’ to their financial worries. The most recent evolution of credit cards includes the development of contactless payments which makes the process of purchasing items seamless and some argue that credit cards are taken for granted in our modern financial world.

Their place in the future

It’s clear to see that credit, and credit cards specifically, are going to remain an important part of our everyday lives. But what we at Incredible believe will change is how we interact with it. We see a world of increased control over borrowings, the deployment of technology to automatically ensure you’re always getting the best credit and a world of increased consumer confidence when it comes to understanding credit.

This is the future we’re building for today and we’re excited to see the impact this new world could have on millions of people.