EDUCATORS ’ PERSPECTIVE
Memorandum from the Bradstreet Company , dated April 11 , 1883 .
Collection of the Museum of American Finance
Collection of the Museum of American Finance
The Mercantile Agency Daily Notification Sheet , issued by R . G . Dun & Co . on August 10 , 1885 .
interest , and an additional six months was allowed if storekeepers were willing to pay a moderate interest rate for the extension .”
To obtain such credit , a storekeeper was simply required to obtain a letter of reference from a respected storekeeper , a local lawyer or a minister vouching for the character and creditworthiness of the applicant . This system worked fairly well until economic downturns sent ripple effects through the entire credit system . Moreover , as the country continued to grow , it eventually became impossible for the New York wholesalers to develop the kind of personal relationship with their customers that the credit system required .
Large , well-established European firms , such as Baring Brothers , solved the problem by hiring full-time employees to travel around the United States and gather information on potential credit customers . Such a system was too expensive for most US businesses to emulate . In New York , some wholesalers organized the Merchants Vigilance Association and hired an individual to travel about and produce credit reports for the Association . The effort , however , was short-lived .
Lewis Tappan adroitly stepped into the gap and worked incessantly to get the new agency up and running . This involved going from door to door soliciting subscriptions from various New York businesses . He also worked hard to develop a national network of correspondents who would deliver timely and accurate credit reports to the company ’ s New York headquarters . He took advantage of both his business network and his abolitionist network to find correspondents . When those avenues were exhausted , he worked to identify local lawyers to complete the task . One notable abolitionist who agreed to work for him was Salmon P . Chase , future Secretary of the Treasury , and one of the lawyers he recruited in Illinois was none other than Abraham Lincoln . In the early years , Tappan ’ s correspondents worked in secret to uncover information on local businesses . This unnerved many businesses » continued on page 38
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