How card has taken over paying by cash

Posted on: September 9, 2015 in Blog by Sarah Legge

The recent news that for the first time ever, card and automated payments have now overtaken cash transactions – with the Payments Council stating that non-cash payments amounted to ‘only’ 48% of transactions by consumers, businesses and financial organisations last year – got us thinking here at Imagin Badges about how profoundly the card has altered how we pay for goods.

The credit or debit card didn’t always account for such a huge proportion of transactions, the 19.8 billion non-cash payments that were made last year just shading the 18.3 billion cash payments over the same period. Indeed, back in the 1880s, the idea of using a card to make purchases was only just entering the popular imagination, the concept being described by Edward Bellamy in his utopian novel, Looking Backward – in which the term “credit card” was used 11 times.

It was at around this time that UK customers were first being given the opportunity to use credit vouchers, as introduced by Provident Clothing Group. The idea was that customers could use the vouchers in shops that appeared on an approved list, with payment being made to a Provident Clothing rep who visited the customer’s home.

But the really serious developments leading up to today’s debit and credit cards had to wait until the early part of the following century. In 1914, Western Union began to issue metal cards to customers in the US, providing preferred customers with free deferred payment privileges. By 1950, Diners Club was targeting American diners with its plastic payments cards, the initial 200-strong membership ballooning to a staggering 20,000 people before the year was out.

It helped to kick-start a love affair with the plastic payment card that soon crossed over to Blighty, the UK’s first charge card being introduced by Finders Services, which was founded by Donald McCullough following a trip to the US. The payment card became an ever-more prominent fact of British life in the years after that, Barclays issuing the UK’s first credit card in 1966, and the first cash machine in the world being installed the following year at an Enfield, Middlesex branch of Barclays Bank.

Barclays was also the first bank to introduce a debit card in the UK, in 1987, and by 1994, half of all UK adults held a debit card. More recent developments – such as contactless technology, first seeing use for card transactions in the UK in 2007 – have only further cemented payment cards of all kinds in the national psyche, to such an extent that it seems no surprise these days that card and automated payments could actually exceed cash payments over a year.

Today, payment cards are as standard a means of ID as our own pin-on badges here at Imagin Badges – and it’s incredible to think of the journey that they have taken from such modest beginnings.

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