How Visa led the way to America’s increasingly cashless society

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This story is part of the Iconic Brands series, a USA TODAY network project showcasing the companies and brands that helped shape the nation’s identity, economy and culture. The series celebrates American ingenuity with a deeply reported examination of how brands intersect with history, community and everyday life in celebration of the nation’s 250th anniversary. Find more at https://usatoday.com/usa250/iconic-brands

Few companies are as intertwined with everyday American life as Visa.

The blue-and-yellow, four-letter logo adorns more than half the credit and debit cards Americans keep in a wallet sleeve or in a digital app.

It may come as a surprise that at the nation’s bicentennial in 1976, the do‑it‑all credit card had only just adopted its modern name and was still a relatively new invention, far from widespread use.

As America celebrates its 250th anniversary in 2026, Visa is one of 50 “iconic” brands the USA TODAY network is recognizing as a celebration of American ingenuity.

Visa has helped shape where we spend and how we spend as the American economy has revved up over the past 50 years.

Its rise is linked to Delaware’s financial deregulation of the early 1980s that turned the three-county First State into the “credit card capital” of the world. Its detractors say the company and others like it can be predatory or monopolistic, making it the subject of recent and ongoing litigation.

An all-purpose credit card to replace the Diners Club

In the 1950s, middle-class Americans had revolving credit accounts with multiple individual merchants like Sears and Mobil Oil or charge cards that had to be paid off regularly.

A popular one was the Diners Club, a card issued beginning in 1950 that allowed members to pay later at participating restaurants.

Attempts to create a unifying, all-purpose credit card came and went.

The earliest versions of Visa cards share its blue, white and gold striped pattern but little of the present-day technology.

The company started as an offshoot of Bank of America when it launched BankAmericard in September 1958 in Fresno, California.

It mailed 65,000 unsolicited credit cards – not applications – to homes around Fresno. National expansion began in 1966.

Technological advancements fueled BankAmericard’s growth in the next decade. In 1973, it launched the electronic authorization system that would become VisaNet. The industry’s first electronic clearing and settlement system followed soon after.

In 1975, the company issued its first debit card.

To manage BankAmericard’s overseas expansion, it established the International Bankcard Company (IBANCO) in 1974. Two years later, IBANCO united all of its networks into a single global network.

To ease hesitation internationally to use products with the Bank of America name, the company rebranded as Visa.

In the early 1980s, Visa redesigned its classic card with a hologram to reduce fraud and established a network of automatic teller machines (ATMs) to compete with bank-owned machines.

Other advancements followed, including electronic signature capabilities and the Visa check card.

How Delaware entered the credit card business

Until the late 1970s, banks had trouble sending credit card offers to out-of-state customers, limiting their reach.

State laws limited how much issuers could charge in credit card interest and federal law largely limited issuers from operating outside their home state.

That changed with a U.S. Supreme Court decision in 1978. In Marquette National Bank v. First of Omaha Corp., the court decided credit card companies could export interest rates from where they were located to other states.

State laws limiting interest rates became a point of competition. Banks could establish subsidiaries in states with the highest limits on interest rates and impose those rates anywhere. As a result, state laws establishing some of the lowest limits on interest rates in places like California and New York were toothless.

Banks in New York, then the capital of the banking world, were paying an annualized interest rate of about 19% to borrow money but couldn’t charge customers more than 12% by New York law.

South Dakota first lured Citicorp. Then, Chase reached out to Delaware, a much closer alternative that was already the corporate home to several large companies for its Chancery Court and other legal benefits.

“It was them going to us, not us going to them,” former Delaware Secretary of State Glenn Kenton told NerdWallet in 2017.

Chase asked if then-Gov. Pierre S. “Pete” du Pont would give them a similar deal to what South Dakota provided Citibank.

“The governor and I got together and said ‘Yes,'” Kenton said.

Delaware’s Financial Center Development Act of 1981 became precedent-setting legislation with nationwide effects. Delaware slashed taxes on banks, eliminated interest rate ceilings on all consumer transactions and allowed banks to charge additional fees on top of interest cost, such as cash withdrawal fees and transaction fees.

Per The New York Times, the legislation was drafted by a lobbyist for Chase Manhattan and J.P. Morgan & Company, which had already committed to set up large-scale operations in Delaware prior to its passing.

Three years later, 11 major bank companies had come to Delaware.

Visa never entered Delaware, but it didn’t have to. As the banking business flourished, Visa products issued by the banks became widespread.

By 2001, more than one billion Visa cards were in use.

Merchants, Justice Department challenge Visa’s place in credit card industry

In March 2024, Visa and Mastercard agreed to cap interchange fees as part of a class-action settlement. The settlement can be traced back to a 2005 lawsuit filed by merchants arguing they paid excessive fees to Visa and Mastercard. The settlement could save merchants an estimated $30 billion over five years.

It also allowed merchants to charge more for credit cards that carried higher fees.

Kim Lawrence, Visa’s North America president, said at the time the company had “reached a settlement with meaningful concessions that address true pain points small businesses have identified.”

In September 2024, the Justice Department under President Biden filed an antitrust lawsuit against Visa as part of its effort to target “corporate middlemen” who impose fees on consumers.

The government claimed Visa acted like a monopoly in encouraging merchants and banks to route their transactions though Visa’s payment network. The company did so, the government alleged, by imposing or threatening to impose higher fees on merchants that also use other payment networks to process debit transactions.

The government also accused Visa of deterring other companies such as Paypal and Square from entering the debit card market and chosing to partner with financial technology companies rather than allowing them to evolve as rivals.

At the time, more than 60% of debit transactions in the U.S. ran through Visa’s network, allowing the company to charge $7 billion in fees each year.

The company has denied the government’s claims in court filings, stating their practices were “procompetitive and outweighed any alleged anticompetitive effects.” In June, a judge denied Visa’s motion to dismiss the lawsuit.

How the list was chosen

The Iconic Brands 50 identifies American companies that most profoundly shaped the nation’s identity, economy and culture. Selection emphasized historical significance, industry-building innovation, measurable economic influence and lasting cultural impact. Brands were chosen for transforming daily life or becoming enduring symbols of American values. Long-term relevance and sustained national influence carried greater weight than short-term financial performance or recent popularity.

Brandon Holveck reports on high school sports for The News Journal. Contact him at bholveck@delawareonline.com.