Credit cards, also known as debit cards, are mainly used for non-cash payment transactions and are a relatively simple credit service. Credit cards originated in the UK in the 19th century and were initially used only in the clothing industry. They only had short-term commercial credit functions, could not be overdue for a long time, and had no credit limit.
In the 1950s, American businessman Frank McNamara founded the “Diners Club” in New York and issued credit cards for members. Members could use the cards to record their consumption at 27 designated restaurants. Subsequently, Franklin National Bank in California, USA, as a financial institution, first issued bank credit cards.
Credit cards have many characteristics, such as consumption first and repayment later, users also enjoy a certain period of interest-free rights, and can repay in installments on their own; credit cards not only have payment functions, but cardholders can also obtain certain loans from the issuing institution through credit cards; using credit cards can reduce the use of currency, facilitate shopping, and enhance a sense of security. At the same time, it can also simplify the collection procedures and save social labor; encouraging advance consumption can stimulate social demand and promote product sales.
In Europe and the United States, the credit card mechanism is very sound, and the credit card user group is huge. It has become the most popular payment method in Europe and the United States. However, credit cards also have some disadvantages, such as fraud, refusal to pay, repayment troubles, high interest rates, annual fees, and easy to lead to blind consumption.
11.1.7 Blockchain payment: highlighting the charm of technology
As an emerging payment method and technology, blockchain provides a platform for distributed ledger technology, which does not require third parties such as banks and other financial institutions to exchange value, solves the trust problem in the transaction process, and has higher security and practicality.
1. Security
At present, mobile payment has been widely popularized, but it also hides a lot of security problems. The emergence of blockchain can solve this problem well. Blockchain can provide technical support for the security of mobile payment. In essence, it bases the transaction on a tamper-proof ledger, making it more difficult to break into the user’s account. Problems such as fraud, repeated payment, and price gouging will be effectively solved under blockchain technology.
2. Timeliness
The current speed of mobile payment has become a problem. Even special virtual transactions such as Bitcoin take several minutes or even hours to complete. However, through blockchain technology, payment speed can exceed the current level and truly achieve timeliness. At present, faster networks are being developed by developers. Through the construction of this technology, people can transfer money to payment objects in any region through smartphones in just a few seconds.
3. Savings
According to a survey by the World Bank, the global average remittance cost is about 7.5%, and commercial banks are even higher, reaching 10%. However, if this ratio can be reduced to 5%, consumers around the world can save at least $16 billion each year. Because blockchain technology does not require the intervention of third-party institutions, users can transfer money to anyone in the world without paying high service and transaction fees.
In addition, there are still many people who do not have bank accounts, but through blockchain technology, people can directly skip the operation of opening a bank account and directly participate in global e-commerce for loans, transfers and other businesses, greatly reducing the time consumption and labor costs brought by the middle links.
4. Convenience
With the support of blockchain technology, mobile Internet will become more convenient, traditional media such as cash and checks will become a thing of the past, and even plastic will become antiques. In life, people will enjoy the convenience brought by Alipay, Android Pay and large retail digital wallets.
5. Sharing
Getting feedback from rewards is more conducive to consumers getting motivated in transactions and generating secondary consumption. It is the blockchain technology that changes the way points are traded, allowing all transactions to be recorded and shared in a public ledger. All merchants in the market can monitor transaction records through the shared ledger to prevent dishonest incidents. The era of universal sharing will come, when people only need to click to send the products or points they bought to other people around you. In the future, all merchants can use this reward system to motivate consumers.
Blockchain technology will undoubtedly make cross-border e-commerce transactions more convenient and will also facilitate more transactions. However, compared with other technologies, blockchain technology is still more mature and requires corresponding supervision by countries and departments around the world. The further development of science and technology will enable it to exert great power.