The Day the Credit Card Was Born

America began to change on September 18, 1958, when Bank of America dropped its first 60,000 credit cards on the unassuming residents of Fresno, Calif. There had been no outward yearning among the residents of the tiny city for such a device, nor even the slightest awareness that such a thing was in the works. It simply arrived one day, with no advance warning. Over the course of the next 12 years, banks would blanket the country with 100 million credit cards of one sort or another. This was the first test of the bank’s BankAmericard. Fresno was chosen as the first test site partly because of its size — with a population around 250,000 it offered the critical mass the bank thought necessary to make a credit card work — and partly because a staggering 45% of Fresno's families were Bank of America customers. Equally as important was Fresno's relative isolation; if the card bombed, the damage to the bank's reputation would be minimal. Credit limits on the cards were between $300 and $500. What Bank of America had not planned for was their first lesson in credit card fraud. What they discovered was that crooks were quick to decipher the symbols on a stolen credit card, so they knew what the limit of the card was. That way, they could make hundreds of small purchases without ever having to worry about a merchant calling the bank for authorization and finding out the card was stolen. The credit card stunt ended up costing Bank of America close to $20 million, and it took well over a year for the BankAmericard program to right itself. As for the credit card experiment, the first shot in the money revolution had been fired.