How the Installment Plan Changed America

credit-cardsNo method of payment changed the buying habits of Americans more than that of the installment plan. The idea of making regular payments as one uses the product caught the imagination of the nation in the early twentieth century. Starting with sewing machines, farm machinery and automobiles, the practice soon embraced almost every line of purchase including clothing. Consumer debt rapidly became a permanent fixture in American society.

Subscription11“The installment plan was to consumer credit what the moving assembly line was to the automobile industry,” writes Lendol Calder. “Without it, today’s trillion dollar consumer credit industry would be inconceivable” (Financing the American Dream: A Cultural History of Consumer Credit, Princeton University Press, Princeton, 1999, p. 17).