Country Club Billing

Country Club Billing

Investopedia / Joules Garcia

What Is Country Club Billing?

Country club billing was a former billing system used by credit card companies until the 1970s that involved including copies of original sales drafts to cardholders in their monthly statements. This was done to provide proof of each purchase that was recorded on the card. Rising paper, mailing, and labor costs put an end to this style of billing.

Key Takeaways

  • Country club billing refers to an old-school accounting method, using paper billing statements.
  • Today's billing statements are itemized and electronic.

Understanding Country Club Billing

The term "country club" may have originated from the fact that only well-to-do individuals carried credit cards. Another theory was that country clubs have a billing methodology of recording all sales transactions (food, drink, personal services), keeping them in a file for an individual member, and then presenting the bill at the end of a month. Whatever the derivation of the term, this system of billing has long since been discontinued. The credit card billing system we are familiar with today itemizes purchases with transaction dates, vendors, and amounts.

Toward a Paperless Society

Environmentalists hated country club billing (also country clubs, for that matter) because of all the paper involved. As credit card companies moved from mailing copies of sales drafts to itemizing transactions on one or two pieces of paper, they reduced usage of paper and in so doing eliminated a portion of operating expenses. The trend toward electronic storage of credit card transactions that cardholders can access online will continue to further cut down on paper waste. If a cardholder has a question or issue with a particular transaction, they merely need to pick up the phone, send an email, or engage in a live chat to sort it out. There is always a paper trail but without the paper.