American Express began as a freight hauler and invented travellers cheques out of frustration
Around 1890 the president of American Express came home from Europe fuming. Despite carrying proper letters of credit, J. C. Fargo had struggled to get cash outside big cities. He asked an employee for something better, and in 1891 the company rolled out the American Express Travelers Cheque.
The business started in 1850 in Buffalo, New York, as a freight forwarding firm formed by merging delivery companies run by Henry Wells, William G. Fargo and John Warren Butterfield. When Butterfield and other directors refused to push west to California, Wells and Fargo launched Wells Fargo in 1852. For roughly two decades American Express enjoyed a near monopoly on express shipments of goods, cash and securities across New York State, and its early headquarters included an Italianate palazzo on Hudson Street with a freight depot on the ground floor.
Finance crept in gradually. A money order service arrived in 1882. Marcellus Flemming Berry answered Fargo's complaint with cheques sold in denominations of 10, 20, 50 and 100 dollars. When the First World War broke out in 1914, the company honoured cheques and credit letters for stranded Americans, and Britain made it an official agent, delivering money and parcels to prisoners of war. A travel division followed in 1915. Its original trade disappeared when federal control of the railroads during the war led to a single American Railway Express Company in July 1918.
Cards came late. Executives mulled a charge card from 1946, but only Diners Club's March 1950 launch spurred action. By the official start on October 1, 1958, 250,000 cards had already been issued, priced at 6 dollars a year, one dollar dearer than Diners Club, to signal prestige. The first ones were paper with typed details; embossed plastic followed in 1959. Gold arrived in 1966, green in 1969, platinum in 1984 and the Centurion in 1999, while Don't Leave Home Without It debuted in 1975.
Diversification had mixed results: a stake in Warner's cable venture bought in 1979 for 175 million dollars was sold back in 1985 for 450 million. By the end of 2023 there were 141.2 million cards in force, with average yearly spending per member of 24,059 dollars, and over 1.7 trillion dollars of purchases crossed the network that year.
Source: American Express
