Wednesday May 25, 2022

How the first debit cards came into being

Payment terminals, we talked about their development last time, not only made it easier to pay by credit cards, but together with ATMs they were involved in the creation of a completely new debit card payment device. The United States, Great Britain, France or Germany are countries where it is very much paid through private markets.

Nap. In the United States alone, their number increased from 24 billion to 65 billion in 1971 and 1997, and 1.6 billion, etc., were processed in the United Kingdom in 2001. Banks introduced it to their faster and less expensive processing in the mid – 1960s. years magnetic psmo (MICR), registers uncovered ek etc., but despite their processing, it remained very expensive for banks.

In addition to the cost, there is an unsuitable risk that there will be no financial coverage, and the client’s bank will receive it for payment. In the case of so-called guaranteed drains, this risk is borne by the bank, in the case of drains exceeding this value, the unpaid trader bears the risk. In Europe, the interim use of the euro was facilitated by the introduction of the euro, but as in the United States, the maximum guaranteed amount of the euro in this case was set at EUR 400. For all you had to fill in more euros or issue euros on a non-guaranteed bank (max. 5000 euros) and wait to see if the bank would pay him in a few days or weeks what traders and banks allowed only very well-known clients.

Do you think that the platebnch card is forever? Test yourself!

First debit card issued probably by Arizona Bank in 1974. The transactions were not authorized against the card or the counter here, but directly against the cardholder. Using a card was easy and cheaper than paying by e-card. In addition, merchants paid the bank the same commission (2-3%) as at karet kreditnch. Also, this type of card began to be issued and put by banks, including the Colorado National Bank. Her card program was played by D. Dale Browning, who wanted the debit function to work on the VISA card of the bank. VISA rejected this a lot.

The dark bag did not end this case. Colorado National Bank founded the Rocky Mountain Bank Card System in the late 1970s, which provided banks with VISA cards for merchants. In 1977, about 400 banks were involved. Browning thought of merging their ATMs into a single st. So it was created with an ATM, which got the name Plus System and there were only private and VISA cards. spch arrived instantly. During the mole time Plus joined ATMs in Colorado, Iov and Nebraska.

Thus, by the way, broke ATMs with a restrictive rule that limited the activities of banks to the land of their media. With the help of debit cards, banks could serve clients wherever there were Plus ATMs. He now saw the VISA series. She demanded that Plus ATMs repay cash on VISA card holders issued by other banks. The banks refused. Their system is closed, privtn. The Plus logo is on the back of the party bank cards. By the end of 1980, Plus had spread to 12 stt USA. The following year, Browning offered the 27 largest VISA members in the United States a project to build a nationwide ATM with an entry fee of $ 100,000.

VISA President Dee Hock believed that the new system based on VISA and Plus cards would jeopardize the principle of guaranteed acceptance of VISA cards. Seel therefore led the Colorado National Bank. In the end, agreements were reached. In 1983, a nationwide ATM was built. At the end of the 1990s, VISA built its own ATM, consisting of three member banks around the world. In addition to them, it developed with Plus at partner stores. Today, most ATMs bear the logo of both systems.

The development of debit cards has offered clients a convenient and secure tool for cashless payments and cash withdrawals worldwide. Bank debit cards have made it possible to bear operating costs by reducing the number of branches or cash registers on them. This is the main purpose of debit cards.

Benefits for the client:

  • worldwide s,
  • comfortable
  • bezpen,
  • simply not cash or eky.

Business benefits:

  • fast pay,
  • zaruen hrada,
  • dream fraud.

Vhody pro banku:

  • ability to compete,
  • improved customer service,
  • beyond customer loyalty,
  • dream of operating costs of sales st.

FIRST TRIALS

Debit cards have become a logical continuation of credit cards and Charge Card. The conditions for this development were created by the VISA and MasterCard associations by building modern authorized systems in the mid-1970s. It only took a few seconds to authorize the transactions. At the same time, banks have built regional and national ATMs and ATM cards have been used by all bank clients. Authorization and processing of ATM transactions began to be seized by boards of companies. Therefore, the concept of off-line and on-line payment cards, which would replace payment cards, was born in the collection of payment cards of the United States.

In June 1975, VISA (then BankAmericard) introduced a debit card in the USA, which gave it the name Entre. A year later, 140 US banks issued about 1 million of these cards, less than 2 percent of the then 80 million BankAmericard credit cards. The number of Entre cards increased to 2.4 million by 1981 and the number of banks increased to a little over 300, but it was not a big deal. The project of the competing MasterCard system developed similarly. In 1978, he introduced the off-line debit card Signet. She did not meet with a large number of traders, because they did not see the bottom of the deal compared to the Czechs. MasterCard therefore replaced it two years later with a new product, the MasterCard II online debit card.

Merchants did not accept the first debit cards in time. They saw in them only the payment of money, they paid the banks for the transaction for days or just very few fees. Banks, on the other hand, charged the same for debit and credit cards. At the end of 1981, the Payn Save business chain from Seattle even sued the MasterCard Association for this fee policy, which failed to meet the requirement to reduce the fee for payments with MasterCard II cards.

Banking associations have realized that they need to choose a different strategy for debit cards:

1. New client segments – clients who could have a credit card in the 1980s had it. It was therefore necessary to focus on other segments of customers.
2. Simplified operations – you had to simplify operations with unified technology for online and offline credit and debit card transactions.
3. Marketing – it was necessary to invest in marketing and convince clients and merchants about the suitability of debit cards.
4. Reduced fee If debit cards were to replace Czechs, there had to be a reduced fee for paid merchants.

Thanks to these changes (especially the reduced fee in 1983), the off-line VISA Check debit card and the first nationwide MasterDebit online card became available in the USA in the second half of the 1980s. The VISA Check advertising campaign was launched with the slogan The Card That Works Like a Check, which explained that the card is as easy as a card, but unlike the client, the client did not pay for proof of identity. Between 1990 and 1997, the number of VISA Checks in the United States increased from 7.6 to 58 million and sales rose from 5.9 to 58 billion USD. In 2000, the number of VISA debit cards in the USA reached 100.7 million (40% of VISA cards).

MasterCard introduced a new off-line MasterMoney debit card in the late 1980s. In 1991, US banks issued more than 1.4 million MasterMoney cards and had a turnover of $ 794 million. Six years later, there were 22 million of them and a turnover of more than 17 billion USD. This was the largest number of debit cards. The MasterDebit debit card, introduced in the USA in 1988, was very successful. But the future of the debit card was just waiting.

Excerpts from the book
Pavla Juka: Encyclopedia of Payment Cards

1. dl: How to pay securely on the Internet?

Step 2: How did the river come about?

Step 3: How did the pensions come about?

4. dl: How banking originated

5th dl: When did the papyr pension arise?

6. dl: Pensions and echoes: when was the crown created?

7. dl: How are banknotes printed?

8. dl: Protection of banknotes against counterfeiting

9. dl: How and where the payment cards were created

10. dl: How payment cards were created-II

Debt 11: Who issued the first universal payment card

Debt 12: When did banks start issuing cards

13th dl: How MasterCard cards were created

14. dl: How the VISA cards were created

DL 15: The role of payment cards in Europe

16. dl: Payment cards in Europe and their arrests in R

DL 17: What caused the boom in payment cards

18. dl: Payment cards: magnetic stripe

19. dl: How to make cards

Year 20: How the first ATMs were created

21. dl: New generation ATMs

22. dl: Since when do we pay in stores by card

23. dl: How payment terminals have evolved

advertising


ryvek is from the bookEncyclopedia of payment cardsvydan nakladatelstvm City Publishing, who published publications in the FINANCE edition such as:
Make a investment, 2nd born ed
Investovn pro zatenky
Financial Mathematics Pro, 5.vydn

Back to Top