Credit Card Industry to Salute Three Pioneers

In their heyday, D. Dale Browning, Kenneth V. Larkin, and the late Karl H. Hinke were like the Mantle, Mays, and Snider of consumer payment systems. On Saturday night the American Bankers Association will give them their due.

At a private dinner on the eve of the ABA's national bank card conference in New York, distinguished service awards will be conferred on the three industry pioneers - one posthumously and one in absentia.

The association's bank card executive committee plans to turn the ceremony into an annual Hall of Fame-style event.

Mr. Browning will be cited for his role in creating national automated teller machine networks. He was the chief organizer of Plus System Inc. in 1982, and he remained close to the operation for many years, most recently as senior consultant to Plus' parent, Visa International.

Mr. Hinke, who died in 1990 at age 84, was considered the creative force behind Interbank Card Association, the original multibank group that evolved into MasterCard International.

Mr. Larkin was one of the leading lights of Bank of America's BankAmericard, the prototypical general-purpose credit card, and was responsible for the nationwide licensing program in the mid-1960s that became National BankAmericard Inc. and later Visa.

"Nothing could be more fitting than to honor the individuals whose own strategic vision created the payment systems of today," said Keith Coughey, chairman of ABA bank card executive committee and group vice president at PNC National Bank.

Mr. Browning, currently a senior adviser to Visa, will attend the dinner, which will be at a New York restaurant. Mr. Larkin and the family of Mr. Hinke will send representatives, an ABA spokeswoman said.

Each of the winners was proud to be a revolutionary.

For Mr. Larkin, along with other BankAmericard pioneers, that meant creating a consumer product for which there was no measurable demand - and a lot of skepticism to overcome.

And as BankAmericard swept the country, Mr. Hinke, then at Marine Midland Bank, brought together a national coalition of competing banks to develop the rival Master Charge system.

About a decade and a half later, Mr. Browning, a Colorado National Bank executive and veteran of the earliest credit card battles, stood up to the Visa and MasterCard associations, which wanted to set the terms for ATM sharing. He fought for a national network owned and controlled by banks.

Starting with the members of Rocky Mountain BankCard, Colorado National's credit card affiliate, Mr. Browning's regional Plus ATM program grew into a national, and eventually global, marketing force.

"Today we take that kind of product and service for granted," Mr. Browning, 58, said in a recent interview, "but back then ATMs were not being used on a national, let alone international, basis."

One of the biggest challenges, he said, involved "bringing a balance of fairness" between big banks and smaller banks.

"Large banks tend to want to make sure they have control equal to their size," he noted. "Small banks want to make sure that they're not discriminated against."

Ron Reed, a senior vice president at Plus System and a colleague of Mr. Browning's for 22 years, described him as a "warm and caring person who put the needs of his people first and foremost."

Mr. Reed said that before Plus was founded, neither Visa nor MasterCard had recognized the importance of debit services and ATMs. The new company, he said, "spawned a competitive reaction (Cirrus, which was later acquired by MasterCard) and moved the focus away from exclusively on credit cards and into a debit world."

Mr. Larkin, 74, is happily retired from Bank of America since 1984, living in California, and occupied with golfing and other recreational pursuits.

He has the rare distinction of having been born and raised in the shadow of the Brooklyn Dodgers' Ebbets Field, yet being a life-long Yankees fan. "I would get on the subway, go to the Stadium, and sit behind DiMaggio in the center-field bleachers," he recalled.

Mr. Larkin joined Bank of America in 1945 and rose quickly to branch manager and later executive vice president.

"Ken was responsible for about 90% of the BankAmericard program," said former Visa chief executive Charles T. Russell.

Mr. Larkin said the implementation of the BankAmericard licensing program was his proudest achievement.

"It came at a time when our largest national competitors -Chase Manhattan and Citibank - were making overtures to Diners Club and Carte Blanche," said Mr. Larkin.

"Our program was doing fine in California, but we felt if those banks went nationwide we would be left with a regional card. I devised a program to franchise our know-how and then license to those banks that bought in on our franchise.

"We had an open field in California for seven years. That was too much for the other banks in California, so they formed MasterCard."

That was where Karl Hinke came in.

A Philadelphia native, Mr. Hinke joined the Marine Midland system in Buffalo in 1930. His time there was interrupted by three years in the Marines during World War II.

In the late 1930s, Mr. Hinke helped establish a program for commercial loans secured by accounts receivable and inventory to assist borrowers who could not qualify for unsecured loans. The program was essential to both new businesses and older ones working for recovery from the Depression, and became a key source of industrial financing during the war years.

That program's legacy can be found today in Marine Midland's commercial finance division.

In 1961, Mr. Hinke became a vice president, rising to executive vice president the following year.

It was in 1966 that the Buffalo bank united with a motley group that included Citizens and Southern National Bank of Atlanta, First National Bank of Louisville, Valley National Bank of Arizona, and Pittsburgh National Bank.

The group came to be known as Interbank Card Association. They later adopted the common Master Charge identity used by the California competitors of Bank of America, which had bought it from a small company in Kentucky.

"He was one of the real pioneers on the other side of the coin," Mr. Larkin said of Mr. Hinke. "He was a man of considerable perspective. He recognized that if we were going after just one bank (in each market), then others should have another place to go."

Charles Russell, who retired from Visa in 1993, but was at Pittsburgh National in the Interbank days, said Mr. Hinke "created the kind of organization that both credit associations use today." "Recognizing that back then banks could only bank in one state," the Interbank interchange idea "was considered at that time to be a big deal," Mr. Russell said.

He added that Mr. Hinke "was a very, very good banker who understood the credit card business, not just as a day-to-day business but what it could develop into." "You could say that Karl Hinke was the founder of the association approach to expanding credit card utilization," Mr. Russell said. "Bank of America was the founder of the national card. Interbank was founded as a reaction to their franchise program, which was the major contribution of Ken Larkin."

Mr. Larkin said he believes the bank card industry has changed drastically in the decade since he left.

"There really is not that much difference any more between Visa and MasterCard," he said. "When I was at Bank of America, we had to offer MasterCard just to protect our flanks, because if we didn't, merchants would go to a bank that accepted both."

He attributed this transformation to "changes in marketing," such as incentive programs and low-rate teaser offers.

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