The first modern U.S. credit card was launched in 1950, but women weren’t allowed to open credit cards until 1974.
The Equal Credit Opportunity Act of 1974 made it illegal to deny credit to people based on gender, race, religion or national origin.
Credit cards might seem like an inescapable part of everyday life, but it wasn’t long ago that half the population wasn’t allowed to have one. That’s right: until 1974, women didn’t have the right to open their own credit cards.
A big part of women’s history is about money: when, whether, and how women are allowed to earn their own money, control their own money, and make their own decisions about personal finances. Within living memory, just 50 years ago, women didn’t have the right to control their own banking decisions.
Let’s look at the history of women being denied credit cards, and see how it relates to ongoing progress (and challenges) toward financial inclusion in the banking industry today.
History of credit cards: 1950-1974
The first modern credit card was the Diners Club “charge card,” introduced in 1950 to help businessmen pay for restaurant meals. American Express started issuing its own charge cards in 1958, and the companies now known as Visa and Mastercard were launched in 1966.
But it wasn’t until 1974 that women were allowed to open a credit card under their own name. Before 1974, if women wanted to open a credit card, they would be asked a bunch of intrusive questions, like if they were married or whether they planned to have children. If a woman was married, she could (hopefully) get a credit card with her husband. But single, divorced, or widowed women weren’t allowed to get a credit card of their own — they had to have a man cosign for the credit application.
Under the laws of that era, women weren’t treated entirely like actual people with economic rights and earning power of their own. Then in 1974, the Equal Credit Opportunity Act made it illegal for companies to deny people credit based on their gender, race, religion, or national origin.
Why access to credit is a civil right
Getting access to credit is a big part of financial freedom, and until 50 years ago, half the population didn’t have it. The word “credit” is based on the idea of trust. When a bank issues you a credit card, it is expressing trust that you are a responsible adult who will pay your bills. Not giving women credit cards was a way of treating women like children, and keeping women under men’s control.
Getting to control your own credit cards and spending decisions is not just about personal finances; it’s about fundamental rights to privacy, autonomy, and human dignity:
What if a woman was in an abusive relationship with a controlling spouse who wouldn’t let her spend money?
What if a woman was the primary breadwinner in her household, and was better equipped to manage credit card bills than her lower-income husband?
What if a woman just wanted to spend some “fun money,” or spend frivolously or even recklessly?
Denying women credit cards was really bad for business. Think of all the money that banks and credit card companies have made in the last 50 years, since they started issuing credit cards to 100% of the adult population, instead of just 50%! Imagine, sabotaging your own business because you thought women shouldn’t have credit cards.
Financial inclusion is the right thing to do, and it’s good for financial institutions! We all benefit when more people can participate in the global economy, without having to ask some guy for permission.