AllieKat

Oh, I didn't understand that, I thought Diner's/Discover issued the card here themselves. There goes my idea of bringing Discover to the UK...

sdsearch

Diners and Discover are separate companies at the card level; it's only the network that they share.

This is a Diners Club forum. It's not about Discover cards, those are discussed in the Credit Cards forum. The Discover cards have nothing to do with Diners Club except running on the same network.

And in the USA/Canada, where Diners Club cards issued locally run on the Master Card network, Diners Club and Discover cards have 0.0000000% to do with each other.

AllieKat

Outside the US, however, where 99% of people with a Diner's Club card are, it's the same company as Discover in the US. Therefore it is relevant whether the company (Discover Financial Services) issues the current Diner's card in the UK, or whether it is licensed (as it turns out to be). See, that makes a MASSIVE difference in interchange rates in the EU (networks that license the rights to other companies to issue cards are capped at 0.3% interchange for credit and 0.2% for debit).

If Discover Financial Services was issuing the current Diner's Club UK card, like I thought, then they could profitably introduce the Discover Card alongside it. Since they DO NOT issue the Diner's Club card, they can't, as the 0.3% cap applies.

This situation is biting American Express right now (I wonder if when current agreements expire, they'll quit allowing other issuers...).

It is only in the US where Diner's Club is unrelated to Discover, and even there not terribly relevant since almost no one has a US Diner's Club card (they only accepted applications for several months out of the last several years, and the majority of people who got one then got their account cancelled later).

reclusive46

They also don't acquire their own merchants anymore and they use merchant providers and the EU counts that as a 4 party network.

AllieKat

Well, there goes that idea, LOL.

sdsearch

No, it's not. You're confusing the network operator with the card program. The Diners Club network operator worldwide, including in the US, is Discover/Diners Club/UnionPay. The card program has nothing to do with Discover (or UnionPay); it is Diners Club on its own. The fact that the card program and the network use the same name may be confusing to you, but it has precedent.

It's a bit like Amex. There's Amex the bank, and there's Amex the network. There are some other banks in the US totally unaffiliated with Amex the bank (in terms of ownership) that nevertheless issue cards that run on the Amex network. Yet most cards that run on the Amex network are issued by Amex the bank. People get confused by this a lot too.

AllieKat

I'm very familiar with it, but EU directives don't see it as separate. If Diner's Club is franchised in the UK (or even, as it turns out, they use third party acquirers), then the whole network has to face interchange regulation. My interest is in the Diner's Club cards here in the UK, as their existence prevents Discover from coming to the UK and being profitable (as it makes them a four-party scheme).

Yes, I'm aware the program is unrelated to the network, though as a practical point that only matters in the US, and there are almost no Diners Club program members in the US as it's ended years ago (except for one several month period where they signed up a bunch of people, then cancelled most of them).

sdsearch

I don't know whether that's what's preventing Discover from coming to the UK. Discover is very USA-centric in their whole approach, and they'd have to "reinvent" themselves for other markets, and they may feel that's too much of a learning curve to bother with. Just because they are known for great customer service in the USA doesn't mean they can translate that so easily to every other country in the world. What's considered "friendly" in one country can be considered "rude" in another!

Remember, Discover is or at least was very tied into Sears (department store), in the you could pay your Discover statement bill at Sears check-out counters throughout the store (back before online payment became common), and is Sears that common in the UK?

Meanwhile, isn't it rare for most US banks to be in the UK? Is Wells Fargo there? Is Bank of America there? And speaking of Diners Club, is BMO there?

mia

Bank of America is a large affinity card issuer in the UK:

https://www.mbna.co.uk/

...but you won't see any explicit mention of Bank of America on the site.

Sears sold Discover in 1993. I don't see how that is relevant to the opportunity to launch the brand in Europe. I think the bigger obstacle is that it would put the owner of Diners Club International in direct competition with their Diners Club franchisees (or it would have to be offered through those franchisees as a secondary brand.)

AllieKat

Actually, you do see Bank of America on the MBNA site. In the EV cert validation on the address bar when you log in to online banking I'm actually rather shocked they don't get a separate MBNA EV cert...

I agree that Diners is the obstacle here they need to cut off their franchisees!

sdsearch

What countries besides the USA is Discover active in (in terms of issuing cards)? Is it Canada only, which would seem to be the answer if it's parallel to where the Diners Club International network isn't used with Diners Club cards?

reclusive46

Canada doesn't have Discover either, the only places I've even noticed accepting it are Walmart and Calgary taxis. I vaguely remember Discover cards being issued in some South American country but I can't remember which.