Magazine article American Banker

1st Data Unit Will Market Card Services to Banks for CUC International

Magazine article American Banker

1st Data Unit Will Market Card Services to Banks for CUC International

Article excerpt

CUC International Inc., the credit card enhancement firm, announced that it had signed a cooperative marketing agreement with First Data Resources, the Omaha-based card processing unit of First Data Corp.

As part of a drive to broaden the distribution of its Comp-U-Card services, CUC will rely on First Data as sales agent to small and medium- size financial institutions.

CUC, based in Stamford, Conn., has never before relied on another company to sell its services directly to card issuers.

About 37 million cardholders subscribe to CUC's programs, which include discount shopping, travel, insurance, checking account enhancements, and dining club services. Typically, such programs cost about $50 annually.

In the past CUC has targeted mostly larger banks like Citibank. For many years, CUC managed Citibank's Citidollars loyalty program, which was discontinued last year.

CUC hopes to add three million to five million cardholders through its partnership with First Data Resources.

Under the agreement, the First Data Corp. unit will collect approximately 15% to 20% of the Comp-U-Card membership fees it brings in. The card-issuing bank gets 10% to 15% of the fee and CUC keeps the rest.

"This agreement provides us with a competitive advantage in today's small to midsize credit card processing market," said Aldo Tesi, president of First Data Resources. "By partnering with CUC, we will now be able to provide greater value to our credit cardholders through the breadth of products and services CUC offers. …

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