The history of money: How the way we pay has changed

Digital payments may represent the future of money, but a walk through history shows how Americans have progressed from beads to banks to bitcoins

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Where we are:
68% of consumer transactions are cashless
Source: Federal Reserve, 2015 

3.6 Average number of ways we pay bills each month
Source: Fiserv, 2016 

46% of us have made a payment via smartphone
Source: Pew Charitable Trusts, 2016

How we got here:

The U.S. Constitution grants Congress the power to coin money and prohibits the states from doing so.

Alexander Hamilton, the first Secretary of the Treasury, proposes the first national bank. It lasts for only 20 years.



The U.S. dollar is established as the sole currency under President Abraham Lincoln.

In a precursor to store credit cards, department stores begin using celluloid charge pieces.


Creation of the Federal Reserve, the country’s central banking system.

The $10,000 bill is introduced into circulation. (That amount is equivalent to $180,000 today, when adjusted for inflation.)

The first bank card is issued, allowing bank customers to buy on credit.

Diners Club claims to create the first credit card after its founder forgot his wallet at a business dinner. A year later there are 20,000 cardholders.

The first ATMs appear.

Credit card companies begin introducing loyalty programs, a precursor to rewards cards.

Personal check usage peaks, and e-commerce and online payments begin their ascendancy.

80% of U.S. banks offer online banking.

Most large banks offer mobile banking apps. The cryptocurrency Bitcoin is introduced.

Debit cards are the most popular form of payment.

Wallets go digital (Link: What is a digital wallet?:, allowing people to use a debit or credit card via their smartphones.

Chip credit cards become the new global standard, providing enhanced security when used at chip-enabled terminals.

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The material provided on this website is for informational use only and is not intended for financial or investment advice. Bank of America and/or its affiliates, and Khan Academy, assume no liability for any loss or damage resulting from one’s reliance on the material provided. Please also note that such material is not updated regularly and that some of the information may not therefore be current. Consult with your own financial professional when making decisions regarding your financial or investment options.

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