Credit Card Basics

What is a credit card?

A credit card is a card issued to the holder, which allows them to buy goods and services on credit up to a certain limit. The consumer is then billed at a later date for these purchases and has to pay off the amount, either in one lump sum or over time, in which case they will be charged interest on the total owed. Credit cards are now used widely all around the world, giving owners the chance to purchase virtually anything. Over time, their features have developed so that they are no longer just used to purchase goods, but offer incentives and rewards for the cardholder.

When did the credit card first appear?

The credit card first appeared in America in 1951, although the first credit card that resembles the current model was distributed in 1959 by The Bank of America. This BankAmericard took off in 1966, when The Bank of America formed licensing agreements with other banks, enabling the card to be issued on a widespread basis from participating banks. This card was later named Visa in 1976. In the same year fourteen banks united together to form Interlink, which was a bankcard association that could exchange information about credit card transactions.