Credit card companies do not want merchants to charge credit card users more than they charge other customers, even though the merchant pays a fee of 2 to 3 percent (merchants negotiate an exact percentage with their banks) to process credit payments. In some countries this fee may be significantly more. If customers were responsible for this fee, it would often discourage credit card usage.

The credit card was the successor of a variety of merchant credit schemes. It was first used in the 1920s, in the United States, specifically to sell fuel to a growing number of automobile owners. In 1938 several companies started to accept each other's cards.

The concept of paying merchants using a card was invented in 1950 by Frank X. McNamara in order to consolidate multiple cards. The Diners Club produced the first charge card, which is similar but required the entire bill to be paid with each statement; it was followed shortly thereafter by American Express.

An example of the front in a typical credit card:
1. Issuing bank logo
2. EMV chip on "smart cards"
3. Hologram
4. Credit card number
5. Card brand logo
6. Expiration Date
7. Card Holder Name
8. contactless chip

A user is issued a credit card after an account has been approved by the credit provider (often a general bank, but sometimes a captive bank created to issue a particular brand of credit card, such as American Express Centurion Bank), with which they will be able to make purchases from merchants accepting that credit card up to a preestablished credit limit.