The American Express Money Order

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The American Express Money Order

The American Express Money Order

The profits from cash shipments first began to slide when in 1864 the United States Post Office Department inaugurated a form of postal money order. The idea caught on fast. By 1880 more than £100,000,000 a year was being transmitted by postal money order, a large percentage of which was money that would otherwise have been shipped by express. It hurt the profits of American Express, and J. C. Fargo decided to try to get the business back. Once in the 1850s the idea of an American Express money order had been mooted among the directors, who had investigated the idea but had not implemented it. Now Fargo acted.

He went to Marcellus F. Berry, an ingenious employee, and said, "I want a money-order form that is foolproof and can't be raised.

"Yes, sir," said M. F. Berry.

It is worthwhile to take a look at Marcellus Fleming Berry as he sits at his old-fashioned roll-top desk, with his hat pulled firmly down to cover his egg-bald head, pondering the president's words; for by his brilliant inventions of the Money Order and the American Express Travellers Cheque he helped to assure the future of the American Express Company as a world-wide institution.

Berry was a small unassuming man who slipped shyly in and out of his office, hardly ever speaking unless spoken to. He and his assistant, William E. Brown, worked as a team. Brown acted as his spokesman, while Berry did the thinking. He was quietly optimistic by nature. Once J. C. Fargo brusquely turned down a pet project which Berry considered very important. After the president had vetoed it and gone, Berry sat sunk in disappointment. Then he smiled in his shy, quiet way and said, "Well, the things we set most store by and worry most about never seem to take place, but mostly everything comes out all right in spite of that." Later Berry became the first manager of the company's European division, which he had, almost accidentally, fathered.

A few weeks after Fargo had made his demand for a money order Berry came up with an ingenious, if complicated, form. It had rows of figures attached to the side, which the issuing agent tore off down to the amount the purchaser required. Thus it was totally impossible to raise it, since the figures necessary were simply not there. American Express inaugurated Money Order service in 1882.

The Express Money Order was an immediate success; 11,959 were sold in the first six weeks. At first they were sold only at company offices, but soon they could be purchased at railroad stations and eventually even in drugstores. It was a tremendous convenience to people to be able to send money in this form. They knew that it was absolutely safe, for it was backed by the full faith and credit of American Express, which promised that in the event it was lost and cashed by forgery the full amount would be returned to the purchaser. Its advantage over the postal money order was that it could be bought almost anywhere, frequently saving a long trip to the nearest post office. Money Order charges were five cents up to five dollars and eight cents to ten dollars.

Another profitable extension of service followed closely and logically after the Money Order. It is ably described in a publicity release the American Express Company issued in 1883:

In addition to money orders, American Express now offers an order and commission service whereby you can fill out an order, and give it to your local agent. It will be sent to the place named and the article purchased and returned to you at only the regular cost of transportation. No charge for any other service is made. The company, buying a great many goods from certain firms, gets the advantage of prices you could not. You can send to a certain firm for the article needed, or you can leave it to the company's agent at the place named to buy where he can do best.

That is service with more than a smile. It required judgment on the part of the agent and considerable faith on the part of the purchaser. The company deserved this confidence and got it.

For more on A Business Organized As A Corporation in 2015

What next? A SLIP OF PAPER


In 1881 William G. Fargo died in his fine house in Buffalo, and J. C. reigned in his stead. Reigned is the word, because for thirty-five years he was the omnipotent ruler of American Express.

You would never guess the power of the man by looking at him. He was slight and of medium height. He always wore dark conservative clothes and, inevitably, a derby hat. A short, greying beard into which his moustache blended almost concealed his mouth. His cheeks were ruddy with an out-of-door look despite the fact that he spent most of his life in an office.

A nice conservative gentleman, you would say, until you felt the impact of his eyes boring through you from above the eyeglasses which he wore halfway down the bridge of his nose. Those eyes could see anything their owner wanted to observe and nothing to which he was indifferent. For example, he never saw any of his employees, not even his intimate friends among the high officials, as he walked rapidly... see: A SLIP OF PAPER

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