Bank of America, Citibank to Offer American Express Credit Cards
NOTE: To offer our weekly summary of credit card rates, Credit Card Monitor, in your publication or on your Web site, please contact syndicate@indexcreditcards[dot]com. Bank of America, Citibank to Offer American Express Credit Cards American Express is lengthening its reach as a credit card payment network, striking deals with both Bank of America and Citibank to have the issuers offer American Express-branded credit cards. Citibank will offer many of its basic card offerings as American Express cards beginning in January, while Bank of America will offer American Express cards later in 2006.
MBNA, which Bank of America is in the process of acquiring, is already offering American Express cards and will continue to do so. American Express became a payment processing network in competition with Visa and MasterCard after Department of Justice litigation resulted in American Express and Discover gaining access to the network of banks with which Visa and MasterCard had previously had exclusivity. In effect, American Express is now a direct issuer of credit cards as well as a payment network on the same level with Visa and MasterCard. (Discover has also become a competitor in this same area.)
Whether issuing banks will balk at having American Express as both competitor and partner in the future remains to be seen. In addition, Visa and MasterCard do not directly issue credit cards, but run the payment networks that their association banks use to process payments. Whether they will push to begin offering credit cards directly is also a question that is certain to be raised.
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