Credit & Money Management
New Cards Target Big Spenders
The end of a six-year antitrust case means new partnerships, perks and products are heading your way. First up: MBNA and American Express with affinity payment cards.
By Joan Goldwasser, Senior Reporter, Kiplinger's Personal Finance
October 22, 2004
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A new American Express credit card offer is rolling out to hundreds of thousands of doctors, lawyers and other college grads.
The new cards, bedecked in school colors and professional association insignia instead of the standard, blue, gold and platinum, represent the first salvo in the latest credit card perks war targeting consumers with big incomes and bigger appetites for credit.
This latest plastic push was touched off earlier this month when the Supreme Court let stand a lower court ruling allowing banks that issue Visas and MasterCards to offer competing cards.
The Supreme Court's non-decision ended a six-year antitrust battle between the government, Visa and MasterCard. Its resolution opens the door to banks for credit card competitors like Discover and American Express.
Teaming up
MBNA, the nation's second largest Visa and MasterCard issuer and a leader in the affinity card arena, is the first U.S. bank to rollout American Express cards. The two companies announced the partnership in January, but waited until the appeals surrounding the antitrust issues were resolved.
Big spenders are the first targets, a statement from American Express chief executive Kenneth Chenault says.
"We plan to add more partnerships with other issuers on a selective basis, ensuring they are a strategic fit for our brand and can drive more high-spending customers to the merchants on our network," Chenault says.
Discover Financial Services, meanwhile, is suing Visa and MasterCard to recover damages as compensation for being excluded from the general-purpose credit card marketplace.
Discover Financial Services is still negotiating with financial institutions about jointly issuing cards with a Discover logo.