The value of a network lies in its ability to expand and as long as there is enough market control and share to grow branded products, card networks didn’t have to worry too much about diversification.
The combination of a mature market and the needs of emerging payment products have changed the network landscape, placing more of a premium on its ability to leverage assets across a wider base. That leveraging opportunity sometimes comes at the price of self-branded products, something Discover is not only willing to pay, but in fact, embrace as a core strength. Its willingness to enable self-labeled transactions across its network is serving to expand its reach into channels that might have been cost-prohibitive as ones that were direct-branded.
…customers of China’s UnionPay can use their credit and debit cards at U.S. merchants that accept Discover cards, and the state-backed payment network recently launched its first prepaid card in the U.S., routing transactions over the Discover Network.
Earlier this year, Discover announced a deal to private-label its network and provide invoice settlement and payments capabilities to Ariba Network, a business-to-business procurement platform.
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