History of The American Express Card
One of the fascinating stories in the credit card industry is that of American Express. American Express started out as a freight forwarding company and evolved into being a leader in the financial products industry. Some of the trademark American Express financial products include money orders and travelers cheques. After the evolving period was over, American Express continued its international expansion and became a company best known for its charge card.
The hallmark of the American Express brand is trust, integrity, security, quality, and customer service. The company was founded in Buffalo, New York, by Henry Wells, William Fargo, and John Butterfield in 1850 and by 1882; they launched their money order business. The product reached Europe soon enough and at a time when it was unheard of. American Express had passed through it transition stage to become world leaders.
THE AMERICAN EXPRESS CARD
American Express had been toying with the possibility of launching a travel charge card around 1946, but it was given a serious thought only after Diners Club launched their charge card in 1950. American Express issued their first charge card soon after in 1958. Within the nest five years, American Express got more than 1 million card holders and it was accepted in as many as 85,000 establishments within the United States as well as outside.
After the success of the charge card, American Express introduced their local currency cards in foreign markets and added programs, which made it possible for card members across the world to extend payment on large travel expenditures. They also launched additional products, like the American Express Gold Card in 1966. Within the next ten years, the Amex card business had grown steadily, generated a profit and brought stability to the company. As for their traveler’s cheque business, it was a roaring success.
By the late 1970s, American Express saw the vision of becoming a global conglomerate. There dream was to own multifaceted businesses with diversified income streams so that the interest of the company could be protected during the rough and hard times. In the next few years, Amex acquired some large acquisitions including First Data Resources, Shearson Loeb Rhoades, Trade Development Bank, Investors Diversified Services, which was later re-branded as American Express Financial Advisors in 1995 and Lehman Brothers Kuhn Loeb.
In the 80’s after a few expensive acquisitions, American Express came up with a different strategy and this was to continue building the company’s core businesses. They unloaded a few of their investments. The eventful year for American Express was in 1986 when their earnings exceeded $1 billion for the first time in its history. Each operating unit of the company posted record-breaking profits.
In 2005, American Express introduced their Clear from American Express, which was the first card that had no fee attached to it. The card also incorporated the ExpressPay technology. In the same year Amex introduced One from American Express card. This card came with a Savings Accelerator Plan, which contributed 1% of the eligible purchases into an FDIC-insured High-Yield Savings Account.
In 2006, the UK division of American Express introduced the Red Card. The red card was an effort towards contributing to a good cause through The Global Fund and this was for helping African women and children suffering from HIV/AIDS, and malaria.