History

In mid-September 1958, Bank of America (BofA) launched its BankAmericard credit card program in Fresno, California, with an initial mass mailing (or "drop", as they came to be called) of 60,000 unsolicited credit cards.^[7] The original idea was the brainchild of BofA's in-house product development think tank, the Customer Services Research Group, and its leader, Joseph P. Williams. Williams convinced senior BofA executives in 1956 to let him pursue what became the world's first successful mass mailing of unsolicited credit cards (actual working cards, not mere applications) to a large population.^[8]
Williams' pioneering accomplishment was that he brought about the successful implementation of the all-purpose credit card (in the sense that his project was not cancelled outright), not in coming up with the idea.^[9] By the mid-1950s, the typical middle-class American already maintained revolving credit accounts with several different merchants, which was clearly inefficient and inconvenient due to the need to carry so many cards and pay so many separate bills each month.^[10] The need for a unified financial instrument was already evident to the American financial services industry, but no one could figure out how to do it. There were already charge cards like Diners Club (which had to be paid in full at the end of each billing cycle), and "by the mid-1950s, there had been at least a dozen attempts to create an all-purpose credit card."^[10] However, these prior attempts had been carried out by small banks which lacked the resources to make them work.^[10] Williams and his team studied these failures carefully and believed they could avoid replicating those banks' mistakes; they also studied existing revolving credit operations at Sears and Mobil Oil to learn why they were successful.^[11] Fresno was selected for its population of 250,000 (big enough to make a credit card work, small enough to control initial startup cost), BofA's market share of that population (45%), and relative isolation, to control public relations damage in case the project failed.^[12]

Visa logo used from July 1, 1992 to 2000

Visa logo used from 1998 to 2005

Visa logo used from 2005 to 2014

Visa logo used in 2014

Visa acceptance logo from 2015 (only in certain Asian, American and European markets)

The 1958 test at first went smoothly, but then BofA panicked when it confirmed rumors that another bank was about to initiate its own drop in San Francisco, BofA's home market.^[13] By March 1959, drops began in San Francisco and Sacramento; by June, BofA was dropping cards in Los Angeles; by October, the entire state had been saturated with over 2 million credit cards, and BankAmericard was being accepted by 20,000 merchants.^[14] However, the program was riddled with problems, as Williams (who had never worked in a bank's loan department) had been too earnest and trusting in his belief in the basic goodness of the bank's customers, and he resigned in December 1959.^[15] 22% of accounts were delinquent, not the 4% expected, and police departments around the state were confronted by numerous incidents of the brand new crime of credit card fraud.^[16] Both politicians and journalists joined the general uproar against Bank of America and its newfangled credit card, especially when it was pointed out that the cardholder agreement held customers liable for all charges, even those resulting from fraud.^[17] BofA officially lost over $8.8 million on the launch of BankAmericard, but when the full cost of advertising and overhead was included, the bank's actual loss was probably around $20 million.^[17]
However, after Williams and some of his closest associates left, BofA management realized that BankAmericard was salvageable.^[18] They conducted a "massive effort" to clean up after Williams, imposed proper financial controls, published an open letter to 3 million households across the state apologizing for the credit card fraud and other issues their card raised, and eventually were able to make the new financial instrument work.^[19]
The original goal of BofA was to offer the BankAmericard product across California, but in 1966, BofA began to sign licensing agreements with a group of banks outside of California, in response to a new competitor, Master Charge (now MasterCard), which had been created by an alliance of several other California banks to compete against BankAmericard. BofA itself (like all other U.S. banks at the time) could not expand directly into other states due to federal restrictions not repealed until 1994. Over the following 11 years, various banks licensed the card system from Bank of America, thus forming a network of banks backing the BankAmericard system across the United States.^[20] The "drops" of unsolicited credit cards continued unabated, thanks to BofA and its licensees and competitors, until they were outlawed in 1970^[21] due to the serious financial chaos they caused, but not before over 100 million credit cards had been distributed into the American population.^[22]
During the late 1960s, BofA also licensed the BankAmericard program to banks in several other countries, which began issuing cards with localized brand names. For example:^{[citation needed]}

• In Canada, an alliance of banks (including Toronto-Dominion Bank, Canadian Imperial Bank of Commerce, Royal Bank of Canada, Banque Canadienne Nationale and Bank of Nova Scotia) issued credit cards under the Chargex name from 1968 to 1977.
• In France, it was known as Carte Bleue (Blue Card). The logo still appears on many French-issued Visa cards today.
• In Japan, The Sumitomo Bank issued BankAmericards through the Sumitomo Credit Service.
• In the UK, the only BankAmericard issuer for some years was Barclaycard. The branding still exists today, but is used not only on Visa cards issued by Barclays, but on its MasterCard and American Express cards as well.^[23]
• In Spain until 1979 the only issuer was Banco de Bilbao.

In 1968, a manager at the National Bank of Commerce (later Rainier Bancorp), Dee Hock, was asked to supervise that bank's launch of its own licensed version of BankAmericard in the Pacific Northwest market. Although Bank of America had cultivated the public image that BankAmericard's troubled startup issues were now safely in the past, Hock realized that the BankAmericard licensee program itself was in terrible disarray because it had developed and grown very rapidly in an ad hoc fashion. For example, "interchange" transaction issues between banks were becoming a very serious problem, which had not been seen before when Bank of America was the sole issuer of BankAmericards. Hock suggested to other licensees that they form a committee to investigate and analyze the various problems with the licensee program; they promptly made him the chair of that committee.
In June 1970, Bank of America gave up control of the BankAmericard program. The various BankAmericard issuer banks took control of the program, creating National BankAmericard Inc. (NBI), an independent Delaware corporation which would be in charge of managing, promoting and developing the BankAmericard system within the United States. In other words, BankAmericard was transformed from a franchising system into a jointly controlled consortium or alliance, like its competitor Master Charge. Hock became NBI's first president and CEO.
However, Bank of America retained the right to directly license BankAmericard to banks outside of the United States, and continued to issue and support such licenses. By 1972, licenses had been granted in 15 countries. The international licensees soon encountered a variety of problems with their licensing programs, and they hired Hock as a consultant to help them restructure their relationship with BofA as he had done for the domestic licensees. As a result, in 1974, the International Bankcard Company (IBANCO), a multinational member corporation, was founded in order to manage the international BankAmericard program.^[24]

Sample Barclaycard (left), as issued in the UK in the 1960s/70s. Co-branded cards were also issued by affiliates, such as the Co-operative Bank and Yorkshire Bank. The Chargex logo (right) used in Canada.

In 1976, the directors of IBANCO determined that bringing the various international networks together into a single network with a single name internationally would be in the best interests of the corporation; however, in many countries, there was still great reluctance to issue a card associated with Bank of America, even though the association was entirely nominal in nature. For this reason, in 1976, BankAmericard, Barclaycard, Carte Bleue, Chargex, Sumitomo Card, and all other licensees united under the new name, "Visa", which retained the distinctive blue, white and gold flag. NBI became Visa USA and IBANCO became Visa International.^{[citation needed]}
The term Visa was conceived by the company's founder, Dee Hock. He believed that the word was instantly recognizable in many languages in many countries, and that it also denoted universal acceptance.^{[citation needed]}
In October 2007, Bank of America announced it was resurrecting the BankAmericard brand name as the "BankAmericard Rewards Visa".^[25]