Ebook Credit card processing as an example of distributed systems
Credit cards where first issued in the United States in the 1920s, where they were used to buy fuel at fuelling stations. In those days the credit card could only be used at the merchant issuing it. In the late 1930s merchants started accepting each others cards to provide more flexibility to the customers.
The concept of credit cards as it is known today was introduced by Frank X. MacNamara, founder of Diners Club, in 1950 – originally to consolidate the processing of multiple cards. Shortly after wards American Express entered the market. In 1958 the Bank Americard was introduced by the Bank of America
becoming VISA later on and in 1966 MasterCard was established.
Today the credit card companies have subsidiaries all over the world using a kind of franchising system. Normally local banks become the partners; being then in the position to emboss and issue cards, provide the clearing, detect and follow up on frauds, acquire merchants and so on.
The handling of credit cards can be split up into two major processes: the authorization- and the settlement process. Especially in the authorization process many security functions have been established to prevent frauds.
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PDF Ebook Credit card processing as an example of distributed systems
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