Magazine article American Banker

Banks Issuing Pre-Approved Lines for Amex's Small-Business Push

Magazine article American Banker

Banks Issuing Pre-Approved Lines for Amex's Small-Business Push

Article excerpt

Banc One Corp. and Wells Fargo & Co. have agreed to assist American Express Co. in a high-profile campaign to establish itself as "the money source for small business."

The banking companies will underwrite pre-approved, unsecured lines of credit that American Express will offer to U.S. business customers, Amex announced Tuesday.

Buying into American Express' desire for closer cooperation with banks, Banc One and Wells view the travel-and-entertainment company's customers as an attractive lending outlet.

"We know how to underwrite and monitor and control credit, and they know how to market the heck out of a product," said Banc One chief communications officer John Russell.

But the cooperation was restricted to that deal, as American Express announced other corporate credit initiatives on its own. Also on Tuesday, it turned up the legal heat on Visa International, filing legal complaints in several Latin American countries - and a request for an antitrust investigation in Puerto Rico - to forestall adoption of a policy that would prevent banks in that region from working with American Express.

Visa's Latin American board is expected to vote on the proposal next month.

"We want to defeat the bylaw before it is formalized and ensure maximum awareness of this issue," said American Express spokeswoman Elisabeth Coleman.

At a New York news conference on the small-business programs, American Express said it will offer two proprietary cards - a Gold Corporate Optima card and a corporate version of the Delta SkyMiles Optima card - each with credit lines of up to $20,000, at an introductory interest rate of 8.9% for six months.

The New York-based card and travel giant also said it was launching a lease- financing program for the purchase of business equipment.

Even as it works with two prominent superregional banking companies, American Express is becoming more competitive against banks and their card associations - Visa and MasterCard - in the rush to serve business owners and entrepreneurs. …

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