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[00:00.38] And the banks profited from small fees on each transaction.

[00:04.37] But soon, banks found another way to make money from these cards.

[00:07.82] They began allowing cardholders to pay off their debt more slowly for an additional fee called an interest payment.

[00:14.72] Essentially, cardholders could choose to pay just part of their monthly bill, and the bank would add a percentage of what they didn't pay to next month's bill.

[00:24.29] Even in these early days, this system wasn't without problems.

[00:28.01] In 1958, Bank of America sent 60,000 unsolicited credit cards to residents of Fresno, California.

[00:35.71] While this promotion was intended to attract new customers, it mostly led to rampant card theft and unpaid bills.

[00:42.35] Banks also struggled to process all the payment paperwork these cards produced.

[00:46.87] At this time, charging a credit card involved stamping a card’s embossed details onto carbon paper and sending out these charge slips for manual processing.

[00:55.63] But as credit card use boomed, banks were left with warehouses of unprocessed charge slips, creating delays that prevented them from charging interest.