History--1968 telephone credit card verification [telecom]

An article in the August 1968 Computers & Automation describes using a card-dialer telephone to verify credit card transactions.

(Note that in the 1970s AT&T developed a special telephone set and corresponding network specifically to give economical fast credit card verification. It was not necessary to dial up each time a verification was needed, but the cost was far less than a normal private line. However, I don't think the system found wide acceptance.)


At American Express Credit Card Division headquarters in New York, a computer is combating fraudulent and abusive use of credit cards by automatically answering telephone inquiries from airlines restaurants, hotels, shops, and other businesses. An IBM System/360 Model 40 computer 'remembers' details on over two million credit card accounts

- including account numbers of lost, stolen and cancelled cards - and can supply information on a specific account in seconds.

Under this new systern, when credit authorization is required or desirabIe, the firm contacts the computer in New York by means of a Touch-Tone Card Dialer telephone. An employee first inserts special dialing cards which signal the computer and identify his place of business. Then, using the push buttons on the phone, he transmits the credit card account number and the amount of the transaction. The computer either gives verbal credit approval immediately or, in doubtful cases, transfers the call to a "credit authorizer," at the same time displaying the account record for him on a display screen.

The new system protects the cardmember, the business establishment and the Company. In addition to being a major weapon against fraud, the new system gives American Express much better control over delinquent accounts. Businesses which do not have the Card Dialer phones installed can relay their queries to the computer through an American Express telephone operator."

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this issue also has ads from Digital for their PDP-9 and PDP-10 systems;

There is an article on computer communications and time sharing:

"Some strong arguments why the requirements of most on-line commercial (and military) computer applications can best be satisfied with a communications data processing system rather than a time-shared system." pg 34.

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