[caption id="attachment_4493" align="aligncenter" width="500" caption=" "]Photo by TaxBrackets.org[/caption]
Credit cards certainly aren't a new phenomenon. In fact, credit cards are nothing more than a physical representation of an old accounting technique that simply puts things “on account” –accounts payable if you owed someone and accounts receivable if you were expecting payment from a customer. Generally, such transactions were limited between businesses, and much of the system was based primarily on the integrity of the company doing the borrowing.
However, consumer credit using cards officially began in the 1920s when select oil companies and hotels would give pre-approved customers the ability to put their charges on account. Such “cards” were limited to transactions occurring only between select customers and the firm from which they were purchasing. Several years later in 1938, companies began to accept cards from other retail merchants too.