Contents

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Technical specifications

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History

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Cash advance

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Usage

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Specialized types

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Benefits and drawbacks

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Security

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Costs and revenues of credit card issuers

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Fees charged to customers

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Over-limit charges

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Neutral consumer resources

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Credit cards in ATMs

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Credit cards as funding for entrepreneurs

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Cashback reward programs

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See also

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References
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Further reading

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External links

Credit card
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From Wikipedia, the free encyclopedia
 This article has multiple issues. Please help improve it or discuss
these issues on the talk page. (Learn how and when to remove these
messages)
The examples and perspective in this article deal primarily with the
United States and do not represent a worldwide view of the
subject. (January 2025)
This article may require copy editing for grammar, style, cohesion,
tone, or spelling. (May 2025)

Credit cards from the South African Absa Bank

Part of a series on financial services

Banking

Types of banks

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Accounts · Cards
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Cards
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A credit card (or charge card) is a payment card, usually issued by a bank,
allowing its users to purchase goods or services, or withdraw cash, on credit. Using
the card thus accrues debt that has to be repaid later.[1] Credit cards are one of the
most widely used forms of payment across the world.[2]

A regular credit card differs from a charge card, which requires the balance to be
repaid in full each month, or at the end of each statement cycle.[3] In contrast, credit
cards allow consumers to build a continuing balance of debt, subject to interest being
charged at a specific rate. A credit card also differs from a charge card in that a
credit card typically involves a third-party entity that pays the seller, and is
reimbursed by the buyer, whereas a charge card simply defers payment by the buyer
until a later date.[citation needed] A credit card also differs from a debit card, which can be
used like currency by the owner of the card.

As of June 2018, there were 7.753 billion credit cards in the world.[4] In 2020, there
were 1.09 billion credit cards in circulation in the United States, and 72.5% of adults
(187.3 million) in the country had at least one credit card.[5][6][7][8]

Technical specifications

An example of the front in a typical credit card:

1. Issuing bank logo

An example of the reverse side of a typical credit

1. Magnetic stripe
2. Signature strip
3. Card security code
The size of most credit cards is 85.60 by 53.98 millimetres (3+3⁄8 in × 2+1⁄8 in) and
rounded corners with a radius of 2.88–3.48 millimetres (9⁄80–11⁄80 in)[9] conforming to
the ISO/IEC 7810 ID-1 standard, the same size as ATM cards and other payment
cards, such as debit cards.[10] Most credit cards are made of plastic, but some are
made from metal.[11][12]
Credit cards have a printed[13] or embossed bank card number complying with
the ISO/IEC 7812 numbering standard. The card number's prefix, called the Bank
Identification Number (known in the industry as a BIN[14]), is the sequence of digits at
the beginning of the number that determine the bank to which a credit card number
belongs. This is the first six digits for MasterCard and Visa cards. The next nine
digits are the individual account number, and the final digit is a validity check digit.[15]

Both of these standards are maintained and further developed by ISO/IEC JTC 1/SC
17/WG 1. Credit cards have a magnetic stripe conforming to the ISO/IEC 7813. Most
modern credit cards use smart card technology: they have a computer
chip embedded in them as a security feature. In addition, complex smart cards,
including peripherals such as a keypad, a display or a fingerprint sensor are
increasingly used for credit cards.[citation needed]

In addition to the main credit card number, credit cards also carry issue and
expiration dates (given to the nearest month), as well as extra codes such as issue
numbers and security codes. Complex smart cards allow to have a variable security
code, thus increasing security for online transactions. Not all credit cards have the
same sets of extra codes nor do they use the same number of digits.[citation needed]

Credit card numbers and cardholder names were originally embossed, to allow for
easy transfer of such information to charge slips printed on carbon paper forms. With
the decline of paper slips, some credit cards are no longer embossed and in fact the
card number is no longer in the front.[16] In addition, some cards are now vertical in
design, rather than horizontal.

History
Part of a series on

Numismatics
the study of currency

 Glossary

Currency
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History of money
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Production
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Early charge coins and cards
Beginning in the late 19th century, charge cards came in various shapes and sizes,
made of celluloid (an early type of plastic), copper, aluminum, steel, and other types
of whitish metals.[17] Some were shaped like coins, with a little hole enabling it to be
put in a key ring. These charge coins were usually given to customers who had
charge accounts in hotels or department stores. Each had a charge account number,
along with the merchant's name and logo.

The charge coin offered a simple and fast way to copy a charge account number to
the sales slip, by imprinting the coin onto the sales slip.[18][19] The Charga-Plate,
developed in 1928, was an early predecessor of the credit card and was used in the
U.S. from the 1930s to the late 1950s. It was a 2+1⁄2-by-1+1⁄4-inch (64 mm × 32 mm)
rectangle of sheet metal related to Addressograph and military dog tag systems. It
was embossed with the customer's name, city, and state. It held a small paper card
on its back for a signature. In recording a purchase, the plate was laid into a recess
in the imprinter, with a paper "charge slip" positioned on top of it. The record of the
transaction included an impression of the embossed information, made by the
imprinter pressing an inked ribbon against the charge slip.[20] Charga-Plate was a
trademark of Farrington Manufacturing Co.[21] Charga-Plates were issued by large-
scale merchants to their regular customers, much like later department store credit
cards. In some cases, the plates were kept in the issuing store rather than held by
customers. When an authorized user made a purchase, a clerk retrieved the plate
from the store's files and then processed the purchase. Charga-Plates sped up back-
office bookkeeping and reduced manual copying errors.
Air Travel Card
In 1934, American Airlines and the Air Transport Association simplified the process
even more with the advent of the Air Travel Card.[22] They created a numbering
scheme that identified the issuer of the card as well as the customer account. This is
the reason the modern UATP cards still start with the number 1. With an Air Travel
Card, passengers could "buy now, and pay later" for a ticket against their credit and
receive a fifteen percent discount at any of the accepting airlines. By the 1940s, all of
the major U.S. airlines offered Air Travel Cards that could be used on 17 different
airlines. By 1941, about half of the airlines' revenues came through the Air Travel
Card agreement. The airlines had also started offering installment plans to lure new
travellers into the air. In 1948, the Air Travel Card became the first internationally
valid charge card within all members of the International Air Transport Association.[23]

Early general purpose charge cards