VISA'S LUCRATIVE HOUSE OF CARDS / Company is recasting itself as a for-profit firm that hopes it can raise $19 billion with an initial public offering

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Visa, which issues those omnipresent plastic card game residing in almost everyone's wallets, started half a century ago as a airplane pilot undertaking in the sleepy-eyed Central Valley agriculture town of Fresno.

It grew into an unusual entity: A rank association of 21,000 fiscal institutions, each issuing its ain Visa merchandises - recognition cards, debit entry card game and other payment methods - and relying on the VisaNet payment system to procedure transactions. Despite being a hugely recognizable brand, a planetary Goliath and the world's biggest payments processor, Visa wasn't really a conventional company but a type of combined or economical joint venture that was regionally decentralized.

But now Visa is adopting a more than traditional corporate structure. In October, the San Francisco house revamped itself as a for-profit company in readying for a stock offering. On Tuesday, it revealed the expected pricing for that IPO, the biggest in U.S. history.

The way toward Wall Street started in 1958 when Depository Financial Institution of United States was experimenting with an advanced pecuniary device: the revolving-credit card, a simple plastic card that consumers could transport in their billfold to bear down purchases.

About 65,000 local BofA customers, a one-fourth of Fresno's population, signed up for the BankAmericard. About 900 Fresno merchandisers agreed to accept the card, paying $25 to lease countertop processing machines later nicknamed zip-zaps, asset a fee of 6 percentage of card purchases, according to "Visa: The Power of an Idea," a history of the company by Alice Paul Chutkow.

Visa wasn't the first recognition card. The thought had been around at least since 1914, when Horse Opera Union offered a metallic element complaint card (popularized as "metal money"). Plenty of section stores, gas stations and hotels offered recognition card game for their customers. The Diners Baseball Club card, which came out in 1950, was the first recognition card accepted by multiple merchants. American Express released its card in 1958.

But it was the BankAmericard, which quickly distribute throughout California, that caught and held consumers' attention. It was the first to give payment options. Cardholders could pay off their full debt every calendar month or do monthly payments and pay interest.

As the card game took off, BofA licensed the thought to other Banks around the state in a franchise-like arrangement. But within a decade, the system was harass by dependability issues and fraud; card-issuing banks were frustrated that dealing costs far outweighed revenue. A new competitor, MasterCard, created by a grouping of bankers in 1966, was in play.

Dee Hock, BankAmericard director at Seattle's National Depository Financial Institution of Commerce, convened a brainstorming session of respective bankers from around the state at Sausalito's Alta Mira Hotel in 1969 that ended up transforming the card, according to Chutkow.

"They were frustrated and got nowhere for three days," Chutkow said in an interview. "Finally, Dee said, 'Let's visualize a new system that volition work, instead of trying to putter with what we have. Let's think about how an ideal system of digital money would work.' "

Until that point, although some computing machine powerfulness was involved, card minutes were all processed on paper gross from hand-swiped machines.

"At one stage, there were literally secondary schools full of unrecognised gross people had to screen through," Chutkow said. "It was an absolute nightmare."

Focusing on "digital money" was the cardinal to revolutionizing the card. But turning that into world involved major negotiations.

"They had to acquire all these different Banks to travel into partnership together even though they were competitors," Chutkow said. "Dee Hock's original squad convinced them that joining military units on this 1 small tool, this splinter of plastic, was in their best concern interest. It was an unbelievable deed of diplomatic negotiations to make that."

By 1970, 243 Banks had joined military units to make an independent corporation called National BankAmericard Inc., which bought the BankAmericard system from BofA. The new company helped the card go even more than widely used.

Expansion into other states started in 1974. That made the residue of "America" in the card name problematic, spurring a 1976 name alteration to Visa. Rhine Wine and his squad felt that word, besides being short and easily recognized, connoted mobility, credence and travel, according to Chutkow's book.

A assortment of innovations, many fueled by technological advances, soon followed. Visa debit entry cards, traveler's bank checks and electromagnetic point-of-sale authorization were all in topographic point by 1980, according to Hoovers.com, A business-information Web site. A planetary standard atmosphere network, multicurrency processing and smart-card specifications also helped Visa spread out its range and the comprehensiveness of its offerings.

Growth also brought accusals of illegal musculus flexing. The Justice Department filed an antimonopoly lawsuit against Visa and MasterCard in 1998. A federal justice ruled in 2001 that the two associations must halt forcing member Banks to except competing card brands.

Retail giant Wal-Mart led a grouping of 4 million merchandisers in another antimonopoly lawsuit against Visa and MasterCard, alleging that they monopolized the debit-card market. The companies settled before trial in 2003, with Visa paying $2 million and MasterCard one-half that. They also agreed to cut merchandiser fees for debit entry transactions.

The near-ubiquity of recognition spawned by Visa and its rivals come ups with a dark side, many consumer advocators point out. As member Banks inundation letter boxes with credit-card offers, too many people were tempted by the easy offers.

"It certainly have been a double-edged sword in footing of households' debt going up dramatically," said Gail Hillebrand, senior lawyer with the Occident Seashore business office of Consumers Union in San Francisco. "The handiness of plastic have fed the 'buy now, believe later' " mentality.