Hypothetical: Amex co-brands with Visa

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Brad Bishop
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Hypothetical: Amex co-brands with Visa

Postby Brad Bishop » Mon Apr 13, 2015 5:41 pm

Let's say that you have an Amex card, particularly a charge card, and you wake up tomorrow to a notice that Amex has struck a deal with Visa and you will all be receiving co-branded cards. You no longer have a charge card but, instead, have a credit card with some limit based upon the current no-preset spending limit-limit.

Do you keep the card?

On the one hand: It works on both Visa and Amex's networks now so that really expands things.

On the other hand: It's an Amex-Visa.. Why not just get a Visa?

Just curious what the reactions would be and, yes, this harkens back about a decade to the same deal with Diners Club and MasterCard.


For me, in the DC/MC situation, all I thought was: OK, now I just have a MC with a DC logo on it. This is stupid. Just dump it and get a normal MC.


MB131174
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Postby MB131174 » Mon Apr 13, 2015 6:37 pm

It's been a while since I posted here. After spending some time in Panama I had the joy of coming home and getting ill. Oh well.

Anyway - while I agree the DC/MC thing is a bit odd, I have the card and refuse to get rid of it. Why? Chip & PIN and primary rental coverage. As someone who rents cars in Europe on a regular basis, this card basically does it all while I travel. I have full coverage on my rental, plus it frees me up from having to worry about "do I have enough gas in the car to last me today?" I zig zag across the Netherlands, and many fueling stations along the A7 are self-serve only after a certain time. Chip and PIN is the only thing that will work in those pumps. Previously I had to make sure I found a station with an attendant before closing and pay in cash. What a pain!

I almost never use the card State side. I use my Discover for everything unless it's not accepted, then I pull out the DC/MC. However, in my area Discover's acceptance is pretty much on par with MC/Visa, so it's an issue maybe once every few months. (Here's looking at you, Subway!) When in Europe, the DC/MC is the only card I use. For the peace of mine & convenience, it's well worth $95 a year to me. Especially if I were to have a 30,000 euro SUV totaled because I can basically turn in the key and say "oops!" (Not really, but, I wouldn't be liable for it.)
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takeshi
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Postby takeshi » Tue Apr 14, 2015 8:20 am

Responses are, of course, going to vary. It wouldn't matter to us. However, to someone looking to easily keep certain spend from impacting utilization that was counting on the charge card it would be a bigger deal.

Brad Bishop wrote:On the one hand: It works on both Visa and Amex's networks now so that really expands things.

On the other hand: It's an Amex-Visa.. Why not just get a Visa?

I can't see making such a decision based solely on payment networks. One should always consider the entire picture. There are many more factors that play into whether one selects a given card versus competitors such as rewards, benefits, etc.

JamesMS
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Postby JamesMS » Tue Apr 14, 2015 9:27 pm

I have to agree with takeshi on this. There are so many factors that need to be weighted before making that decision. It also depends on each persons situation.
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frinkinhard
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Postby frinkinhard » Tue Apr 14, 2015 11:22 pm

I would get rid of my card. AMEX was created on the basis of exclusivity.
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CarefulBuilder14
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Postby CarefulBuilder14 » Tue Apr 14, 2015 11:27 pm

frinkinhard wrote:I would get rid of my card. AMEX was created on the basis of exclusivity.


It hasn't been exclusive for a long time. I'm not complaining, since it allows people with a short but clean history to get cards (like I did).

From the look of your signature, you shouldn't complain, either.
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Brad Bishop
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Postby Brad Bishop » Wed Apr 15, 2015 5:30 am

frinkinhard wrote:I would get rid of my card. AMEX was created on the basis of exclusivity.


It's funny that it's pretty much an emotional thing.

I can think of two examples where this has happened and then the hypothetical Amex example.

Diners Club and Amex are marketed as premium cards. You're paying a decent AF just to get in the door. They're also see as their own entities.

Before DC did this I felt that Diners Club was it's own entity. Yes, it was, then, owned by Citi Bank but it was separate from the rest and there was a certain exclusivity to it. When they went to being on the MC network a few things happened:
- it was no longer a charge card but a credit card
- it now had a big MC logo on the front
- it felt like a Citi Bank MasterCard with a Diners Club design on the front.

Yes, a lot of stuff was retained like the primary insurance for car rentals and the club points but it really felt like you were just dealing with a Citi Bank MC now. You could argue that putting it on the MC network increased it's usability.

Discover did it, in a slightly different way. As with DC and Amex, you're dealing with the Discover entity (not a random bank with a Visa or MC logo on their card). They bought the network and then put the DC logo on the back. This, in my opinion, retained the uniqueness of Discover and increased it's network at the same time. I think that the fact that they actually bought the USA DC network vs using the MC network as DC did, also helps in not caring so much about it sort of being co-branded. You're still dealing with Discover.

Amex has it's own uniqueness with their charge cards and, back in the 1990s, they started allowing banks to issue accounts that were on their network. At the time I thought it diluted their name and I still do. I have an Amex from my bank. I don't deal with Amex at all on it. It's just the network. I deal with my bank. With that being said it works and I like it and it has no AF but it's not really an Amex card in a traditional sense. For example, Amex has programs and features that they have for cards issued by them and those don't apply to my bank's Amex. I think that Amex also has diluted their brand with the 60+ card offerings.

That being said and getting more on target: If Amex were to co-brand with Visa, I'd dump them for the same reasons I dumped DC. It'd just seem dumb to me. If they were to buy Visa like Discover bought DC (USA) then that'd be a different thing. To simply say, "We're now working on Visa's network," it's like admitting defeat. It's like saying, "We're not going to get any better or build out our own network so, have some of this."

JamesMS
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Postby JamesMS » Wed Apr 15, 2015 10:25 pm

CarefulBuilder14 wrote:It hasn't been exclusive for a long time. I'm not complaining, since it allows people with a short but clean history to get cards (like I did).

From the look of your signature, you shouldn't complain, either.


Now that's funny.
Main Cards:
Amex BCE
Amex Everyday
Bank of America Cash Rewards
Chase Freedom
Capital One Quicksilver
Citi Thank You Preferred

Spark Cash Back (Business), Amex Plum (Business)



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