Cards now wear mantle of valued collectibles.

Credit cards, like prepaid telephone cards and sports cards before them, are becoming increasingly popular for a reason other than the obvious.

They are gaining value as collectibles -- a development that has caught many card issuers by surprise but that may have a business benefit. Like telephone companies, credit card companies might profit from selling visually interesting cards directly to collectors.

But collectors apparently will do their thing even if the industry does not meet them on their terms.

Lin Overholt, who publishes Card Trader newsletter in Madeira Beach, Fla., collects everything from the coins and metal plates that were the original revolving-charge devices, to modern-day affinity cards. He estimates he owns 5,000 cards.

His collection includes celluloid cards issued by the Bamberger's department store during World War I, said to be worth $750 to $1,000 in mint condition.

All cards are worth money, even new ones, he noted, but the most popular are affinity cards with attractive pictures.

The 52-year-old collector said he has been gathering cards since he was 11, when he used his family's John Wanamaker ChargaPlate to buy a copy of the London Times Elizabeth II coronation issue.

Dog-tag-shaped plates, which were common from the 1930s until the widespread use of plastic in the 1950s, can be purchased "in nice condition" for $25 to $50, Mr. Overholt said. Older charge coins, which were issued by Abraham & Strauss and Wanamaker's in the 1890s, can be found for as little as $5, Mr. Overholt said.

The first American Express issue, a paper card, in mint condition would cost about $3,400, but they are rare, he said.

Because there are relatively few Credit card collectors, the prices for old cards haven't skyrocketed, but the hobby is growing. Mr. Overholt's newsletter is one of the few sources of price quotes.

Card enthusiasts find their prizes at flea markets; trade shows, and by mail -- trading with collectors all over the world. The easiest way to start a collection is by applying for as many cards as possible, said Mr. Overholt. Storing the cards in their original envelope without signing or using them will increase their value.

Walter Cavanagh, a certified financial planner in Santa Clara, Calif., said he is listed in the "Guinness Book of World Records" as Mr. Plastic Fantastic because he has 1,359 different cards issued in his name. With duplicates his collection totals 4,000. "I just keep applying and I have great credit," he said.

Mr. Cavanagh, 51, began his collection in the 1970s on a bet. He was challenged to see how many he could get. Now, he said, his goal is "to get all 10,000" of the credit card issues he believes are available in the United States.

Mr. Cavanagh has no estimate of his collection's worth, though he said a card with his name on it, as the holder of the world record, would be more valuable than one with just anyone's name.

Even so, he's not interested in buying or selling. "I get the ones with no fee. The whole concept was an inexpensive hobby."

Mr. Overholt, who has only about 35 cards in his name, occasionally trades live cards with "very dear friends," but he said the risk of unauthorized use requires a lot of caution.

"Clearly, there are potential risks involved in terms of [collecting] credit cards," said Robin Townend, senior vice president of chip card technology, MasterCard International.

MasterCard members are encouraged to direct cardholders to destroy their cards when they receive the renewal, he said.

Mr. Townend, who is a world-renowned collector of prepaid phone cards and the new generation of smart cards, said he collects credit cards in his own name. It is safe as long as the cards remain in the owner's hands. Prepaid cards do not pose the same risk because they are anonymous and fully transferable.

Cards issued by defunct retailers like B. Altman or by a failed bank are safe to trade, but Mr. Overholt has run into cardholders who fear that the companies will resurrect themselves and their card programs, and they'll get stuck with bills.

Most card traders are less concerned with fraud than with tracking. down some hard-to-find collectibles.

"Phone cards are much more collectible -- all you need is the money. With credit cards it's the chase -- you have to work at it," said Mr. Overholt.

According to the periodical Phone Card Collector, the price record was set in June when Elvis Presley's 1973-74 American Express card sold at auction for $41,400.

For reprint and licensing requests for this article, click here.
MORE FROM AMERICAN BANKER