Skip to Main Content

Payment Services

Overview

The payment services industry consists of credit card processing and money transferring companies. These companies include the major, longstanding businesses such as American Express Company, MasterCard, and Visa, as well as First Data Corporation and Fidelity National Information Services. The top digital payment processing and money transferring service companies include PayPal, Square, and Venmo, among many others. In 2019, the credit card processing and money transferring industry generated more than $79 billion in revenue, as reported by the market research group IBISWorld. There are 4,741 payment services businesses and the industry has more than 155,456 employees.

There are many different types of jobs within the payment services industry, such as  financial clerks, financial advisors, financial anaylsts, financial managers, loan officers, customer service representatives, human resources professionals, accountants, to name just a few. Most jobs require a two- or four-year degree in business or economics, and some jobs may require a master's degree. Many employers also provide training on specialized computer software and other technology.

The use of currency to purchase products and services dates back centuries. Prior to coins and paper money, people bartered, paying with cows, sheep, chickens, or other livestock, for example. By the 1800s, merchants would extend credit to loyal customers, and in the early 1900s, department stores started offering store-specific cards. By the mid-1900s, credit cards were introduced for consumers to use as methods of payment for a variety of products and services, such as for entertainment, household products, and oil and gasoline. For example, the 1950s saw Diners Club, American Express, and Bank of America's BankAmericard as the first credit cards. The magnetic strip was added to cards in the late 1960s, and the 1970s brought Visa (a spinoff from BankAmericard) and Mastercard (previously known as MasterCharge). Discover Card was introduced in the 1980s. Most recently, to combat fraudulent activity, credit cards have computer chips in them that create unique transaction codes for purchases.

Western Union was an early money transfer service company, founded in the mid-1800s. It started as a telegraph company, and introduced money transfer services in the 1870s. It still exists today and has grown to become a worldwide financial services and communications company. The evolution of e-commerce in the late 1990s and early 2000s inspired the establishment of money transfer services such as PayPal and Square. PayPal launched in 1998, originally under the name Confinity, with the aim of giving consumers as well as businesses an easy, low-cost way to make payments digitally. PayPal has since grown to generate more than $15 billion in revenue and employs nearly 22,000 people. Square was founded in 2009 as a service for merchants and a mobile payment platform. Today, approximately 30 million businesses use Square technology to accept credit card payments, track their sales and inventory, and secure financing. 

Legislation that has impacted the payment services industry includes the Truth in Lending Act, Fair Credit Billing Act, Fair Debt Collection Practices Act, Credit Card Responsibility and Disclosure Act, Electronic Fund Transfer Act, and the Dodd-Frank Wall Street Reform and Consumer Protection Act. All of these laws were passed to regulate financial markets and protect consumers.