Do you use your credit cards to make big purchases? However, those simple plastic cards are powerful financial tools packed with security features and rewards. You can make your digital payments seamlessly using the card.
Today, financial institutions and banks, such as ING, allow mobile wallet integration with the card. They have also implemented strong measures for fraud detection. Thus, modern credit card experience significantly differs from what it was a number of years ago. This blog gives a clear picture of how credit cards have evolved every year.
1900s-1930s – Coins as a Form of Credit
During the late 19th century, many department stores and large merchants issued charge coins for customers. The metal coins found in different shapes came with the merchant’s logo and name.
After the 1930s, people used to carry a rectangular metal plate displaying the user’s account number and other details.
1940s-60s – From Charge Cards to Credit Cards
John Biggins (a banker) made the first attempt to issue a card that could be used at the merchant store. In 1950, Ralph Schneider and Frank McNamara introduced the Diners Club card, made from cardboard. At that time, cardholders used to make an annual payment of only $3.
American Express issued its entertainment and travel cards, whereas Bank of America launched its BankAmericard in California.
The Beginning of the Card Usage in Australia
In 1974, Australian banks made a joint effort to introduce the Bankcard credit card scheme. They created their own card network and used the technology for a national shared facility. Participating banks launched their branded products.
During the 1980s, Bankcard made a co-branding agreement with Mastercard and Visa to facilitate global usability. But, the agreement did not last long, as it dissolved in the same year.
2000s – The Rise of Perks and Rewards
Credit cards with rewards were introduced in the 2000s. For every $1 spent, users could earn reward points and introductory bonus points. Cash rewards, shopping, and several other options have attracted Australian consumers. Card users can also enjoy benefits like complimentary travel insurance and airport lounge access.
However, during the mid-2000s, consumers started facing scams, such as skimming and phishing. It happened due to the increasing trends of mobile banking and contactless payments.
To prevent risks, card companies and governments have imposed their policies to secure personal information. The most significant security measures were:
- Government assistance services
- Fraud monitoring services
- Zero-liability protection
Other Advancements in Modern Credit Cards
Currently, the credit card industry has undergone several improvements:
One-Time Code – To add an extra security layer, the magnetic chip on the card generates one-time codes during transactions. CVV was introduced to ensure stronger security for the card.
Magnetic Strips – To prevent fraud risks, magnetic strips are used for credit card information processing.
Summary
Credit cards in Australia and other countries have undergone a transformation over time. They were once simple payment cards that were processed manually. But, now, these digitally connected financial tools meet consumer expectations. They are available with innovative features and benefits to ensure better value to users. Virtual-only credit cards are also introduced by some banks in Australia.
