It is curious that the very name "Master Charge" came to mind at once to several people who worked in the US banking industry.
The history of the modern MasterCard company, a real monster of the payment industry, cannot be described in a nutshell. This world-famous company "gathered" together from different times and geography, and it is absolutely impossible to talk about it, omitting even the smallest detail, because. it was from grains that a giant was formed over decades, which we now habitually and carelessly call the “Master”.
The progenitor of MasterCard should be considered the association of three groups of banks (associations) of the Midwest, East and West coasts, formed in the United States in the late 60s. Master Charge became the card brand, and the enlarged association itself was called the Interbank Card Association (ICA). It is curious that the very name “Master Charge” came to the mind of several people who worked in the US banking industry at once (in one case, even as part of a competition announced between employees of a group of banks for the name of a brand new credit card being launched).
The familiar logo in the form of two circles appeared at the same time, only the initial colors of the two intersecting circles that make up the logo of the payment system differed from the usual red and orange.
Let's digress a little from MasterCard and look at the situation in the US banking sector in the 50s and 60s of the last century in order to understand how the situation itself contributed and limited the formation of payment systems. A landmark project in the US card market of those times was the credit card project. Bank of America, which was named BankAmericard. Looking ahead, it should be said that it was this project that subsequently gave us Visa International. Paradoxically, since its inception, the history of MasterCard has been inextricably linked with Visa, in many ways these two payment systems have complemented each other and, in a certain sense, developed. The origin of MasterCard also puts an end to the legend that MasterCard appeared in Europe, and Visa in the USA, respectively, it is more profitable to pay with MasterCard cards in Europe, and Visa is for traveling to the USA (there is such a stable stereotype). The BankAmericard project developed very powerfully and, as they say, set the tone for the entire market. Legislative restrictions prohibited banks of that time from operating outside their "home" states. The idea of associations of banks of different states hung in the air.
Such associations could also regulate the activities of member banks and ensure fair competition in a growing market. The creation of such associations required the emergence of common clearing centers to ensure smooth card payments. At the same time, retail chains faced the problem of a large number of card issuers and with a variety of principles for accepting payments with these cards, settling on them and receiving money for purchases. Retailers were not satisfied with the growing number of issuing banks, so centralization also turned out to be in their favor. Taking into account the fact that it was credit cards that prevailed in the USA, a principle and a system for assessing the risks of borrowers to whom this card was issued was also needed. In this sense, associations would make it easier, in modern terms, to scoring clients and exchange information about them if necessary.
The development of Master Charge took place at an explosive pace, as banking associations from different parts of the United States joined, bringing with them member banks with their customer bases of both individuals and merchants that were serviced by these member banks. There was a technological transformation of all processes associated with the issuance and maintenance of credit cards themselves, as well as the acceptance of payments on these cards. The centralization and standardization of these processes guaranteed a reduction in transaction processing time, uninterrupted settlements between all participants, security and also the speed of transaction processing.
Another important milestone in the development of MasterCard / Eurocard was the partnership with the British Access, which provided access to the banks of foggy Albion and Ireland in 1972. Access was a union of NatWest, Midland Bank, Lloyds bank and National and Commercial Banking group banks, as well as their Irish subsidiaries. Access ceased to exist on its own in 1992, when it was bought by MasterCard.
The first foreign bank to issue Master Charge cards joined the payment system already in 1968, it was the Latin American Banamex. The entry into the European market of MasterCard also dates back to 1968, when an agreement was signed on a strategic alliance with Eurocard, which later played a significant role in the development of the master card. Eurocard played a role in Europe similar to MasterCard: it was an association of banks participating in the European card market. ICA gained access to the card acceptance network in Europe, and Eurocard cards, thanks to such a powerful player as MasterCard, were able to enter the global market. In terms of partnership, both players were different, adjusted for the area of "coverage".
Since its inception in 1965, Eurocard International has undergone a number of changes, but eventually merged with MasterCard in 2002, forming MasterCard Europe, headquartered in Wateroo (Belgium).
In 1979, the name Master Charge disappeared forever: it gave way to our now more familiar MasterCard ear, and this word also appeared on the logo in the form of two intersecting circles.
The next iteration of the logo change was the “penetration” of two circles into each other and a change in the font:
Subsequently, the payment system logo underwent several changes that were not so noticeable to the eye. The latest and most up-to-date version is the following:
It is very difficult to cover the 60-year history of a technology company in a short article. It was influenced by the mass of people who worked in it at different times, entering new geographical markets, each merger or acquisition carried out. The brands Cirrus, Maestro, EC are leaving or have already left. Now we are surrounded by MasterCard PayPass (now MasterCard Contactless), MasterCard Secure Code, MasterCard MoneySend…
The natural course of history and development takes away one thing, but always gives something new in return. Be patient, I'm sure it will be interesting!
