Barter, cash, contactless: a brief history of payment services and solutions

From bartering that had been in vogue for more than 12,000 years to the emergence of “hard cash” currency, 2,000 years BC, then notes around the year 800 and cheques, which arrived in France in 1826 with such resounding success… we have ended up using a wide variety of payment options. These options were further increased in the middle of the 20th century, reflecting the social progress and economic expansion of the country.

Today, the French are world champions in the use of cheques (some 3 billion per year), despite the gradual adoption of three major innovations associated with technological progress: the payment card, ATMs (automatic teller machines) and remote access to your bank account.

From paper cheques to plastic cards

At the end of the 1960s the French massively opened cheque book bank accounts. But this commercial opportunity for the banks also multiplied the transactions that they had to process and resulted in huge paper flows. The payment card, which originated in the United States, changed the way people paid and also enabled the banks to make savings. The first cards were proposed to BNP customers in 1967 under the “carte bleue” label. For this, the bank teamed up with five other banks: Crédit lyonnais, Société générale, Crédit industriel et commercial, Crédit commercial de France and Crédit du Nord. When, four years later in 1971, cash dispensers were introduced, customers could, for the first time, have access to their money 24/7 and this also relieved congestion in the branches. It was not until 1992 that the cards, until then equipped just with a magnetic strip, incorporated the chip invented in 1974 by the Frenchman Roland Moreno, thereby increasing their security.

Minitel, Internet: home banking

1980 saw the start of the great adventure of remote payment first of all with the arrival of telematics as materialised by the iconic Minitel. BNP was a pioneer and took part in the experiments in Vélizy. 2,500 homes (500 being customers of the bank) tested for the first time a home banking service: information about a range of products, addresses and opening times of the branches and, even then, ordering a new cheque book or foreign currency and seeing the situation of their account. The experiment was conclusive and in 1983, six months after national commercialisation of the Minitel, BNP equipped its branches and the first customers who discovered cash management and the placing of trading orders in real-time. The growth was spectacular: 15,000 BNP subscribers in 1984, 225,000 at the end of 1989 (at this time there were 5 million Minitel terminals). Cetelem, the consumer credit company, became a pioneer in the installation of Minitels in points of sale, enabling credit to be finalized at the retailer’s.

Internet took over from telematics and the French started learning about e-commerce and e-payment. Paribas, the leading bank in France on the Internet, opened its information site in 1995. This was followed in 1997 by services for remote invoice payment and payment on Internet. Meanwhile, BNP branched out in April 1997 and created BNP Net which, at the end of 2013, had 2.6 million subscribers. As with the Minitel, this was also successful since the French were becoming more and more equipped with microcomputers.

Micro-payments and e-security: innovation in everyday payments

In 1999, while the banks were slowly adjusting to the euro (in its cashless form), the Moneo pilot scheme launched by BNP and six other banks led to the development of the electronic wallet using a pre-paid smart card, for small payment amounts in everyday life that were usually paid for in cash. This new step towards the dematerialisation of money is today evident in the market launch by BNP Paribas, Banque postale, Société générale, and joined by Crédit agricole, of Paylib, an online payment system that is competing with PayPal and which has the advantage of keeping bank details with one’s bank. For customers, a secret code suffices to pay for a purchase from their computers, smartphones or tablets…

Today, payment without contact or code

The future of payment means lies in mobile terminals, smartphones or tablets. In 2009 BNP Paribas was one of the first banks to offer its customers the possibility of managing their accounts through text messages and to send its customers SMSs. This is also the era of contactless NFC payment technologies, that make things quicker at the check-out till: no need to enter a PIN, you just place your card or mobile phone close to the retailer’s terminal. And to think that some people were predicting the end of the banking system in year 2000…