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A historical look at the origins of the credit card Add to ...

According to its own history, the origins of Diners Club - and hence the credit card industry - trace back to a dinner in 1949 at a Manhattan eatery called Major's Cabin Grill. When it came time to pay the tab, businessman Frank McNamara realized he had left his wallet in his other suit. His wife covered the bill, but the idea for a new business was born.

Within a decade, American Express had joined in, and soon dominated the corporate market that was once Diners Club's exclusive domain. Once the bank-issued credit cards, Visa and MasterCard, got a firm foothold in the market in the late 1970s, merchants flocked to the more broadly issued products in droves. And Diners Club's star continued to fade.

Feb. 8, 1950

The first Diners Club charge is made at the same restaurant by Mr. McNamara, the manager of a loan company and a regular customer whose office is next door in the Empire State Building. Instead of paying cash, Mr. McNamara shows a small cardboard card, a Diners Club Card, with his signature on it and signs for the purchase. This is now known in credit card lore as "the First Supper." He and two partners initially offer the card to 200 people, all of whom they know personally. The cards carry no interest charges, but all accounts must be settled in full each month. Fourteen restaurants initially accept it.


Diners Club claims 42,000 members, and acceptance by more than 330 U.S. establishments. Annual membership is $3 and businesses accepting the card pay a transaction fee.


Mr. McNamara's share is bought out by Alfred Bloomingdale of department store fame. He would later tell a magazine: "Where will it end? I don't see any limits. I think some day you're going to be able to charge anything."


First charge card immortalized on film, in The Man From the Diners Club. The plot: A Diners Club staffer mistakenly issues a card to a well-known crook and has to get it back it to save his job.


Citicorp buys Diners Club.


Diners Club expands small Canadian toehold when Citibank acquires enRoute from Air Canada.


Diners Club reaches deal with MasterCard. Cards branded with MasterCard logo and issued in U.S. and Canada can be used wherever MasterCard accepted.


Discover Financial Services, operator of the Discover card network, buys rival Diners Club International from Citigroup for $165-million. Diners Club cards are still issued separately by licensees, including Citi.


Citigroup sells Diners Club merchant portfolio to US Bancorp.

November, 2009

North American franchise sold to Bank of Montreal, giving BMO exclusive rights to issue the cards in the U.S. and Canada and instantly doubling the size of its corporate credit card business.

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