Base I

WHAT IS Base I

Base I was the primary electronic authorization system for credit card payments. It was developed in 1973 by Bank of America.

BREAKING DOWN Base I

Base I was first developed in 1973 as an electronic real-time authorization system for credit card transactions. It was developed by Bank of America, issuers of the BankAmericard, as part of the VisaNet system. Base is an abbreviation for Bank America System Engineering. Today, the BankAmericard is marketed as the Visa card, and Base I is the first of two phases of the VisaNet system. The subsequent phase is known as Base II.

Prior to the development of the Base I system, credit card processing advanced alongside the growth of a national credit card system. The primary cards were shut circle systems, native to a particular retailer or a limited group of merchants with a business association with a particular bank. In the earliest cases, transactions were recorded by a call from a merchant to the neighborhood bank, who gathered records for a cardholder's month to month statement.

Card systems consistently filled during the 1950s, with Bank of America's BankAmericard overwhelming the California market in the mid 1960s. Open-circle systems, which permitted transactions among contending banks over a broad geographic area, first showed up with the creation of the Interbank Card Association in 1966. This alliance of banks would before long take on the MasterCard brand, and rouse Bank of America to form its own rival network, NBI, in 1970. Around this time, third-party firms arose to support the push toward sans paper processing of transactions. When such firm was VisaNet. NBI acquired VisaNet in 1973 and marketed the Visa card to rival MasterCard. Litigation in the mid 1970s permitted member banks to join the two networks.

How Base I and the VisaNet system process transactions

The development of the Base I system corresponded generally with the send off of the Visa card during the 1970s. Base I alludes to a real-time authorization system through which merchants would send a transaction endorsement request to a bank. The request would incorporate a card number and dollar amount. In response, the bank would either communicate a simple endorsement message or a decline message with a clarification connected.

Base II gives a settlement cycle to handle end-of-day reconciliation for the transactions created by the Base I system. Base II is a clustered system - not at all like Base I's real-time activity, the settlement would occur periodically, and charge a settlement fee to merchants.

As NBI and VisaNet sent off and refreshed it's system, MasterCard followed after accordingly with a comparable two-part processing platform, included a system known as INAS to handle transactions and [INET](/interbank-network-for-electronic-move inet) to settle and clear balances.