Newspaper article St Louis Post-Dispatch (MO)

Visa Heats Up Battle in Credit Card Wars

Newspaper article St Louis Post-Dispatch (MO)

Visa Heats Up Battle in Credit Card Wars

Article excerpt

The credit card battlefield where a fight over lucrative business travel spending is being waged may be turning into a war zone.

If Visa has its way, restaurants will be asking patrons who present an American Express card if they don't, please, have another card - like a Visa. American Express says it doubts restaurants will go along with that and many business travelers won't either.

The fight between bank cards and so-called premium travel and entertainment cards has been going on for years with television commercials reminding travelers where their cards might and might not be good, and what not to leave home without.

At the recent National Restaurant Association trade show in Chicago, Visa unveiled a "lost profits clock" which purported to show that U.S. restaurants accepting American Express instead of Visa were losing more than $6 a second, or $209 million a year, because of the higher fees to process charges on American Express.

Tom Edwards, a Visa vice president for travel and entertainment marketing, said, "We're telling restaurants they should ask first for a Visa . . . we know that nine out of 10 American Express card carriers have a Visa, so it's quite easy to ask."

There are 497 million Visa cards out there, Edwards said, and 300 million MasterCards. In 1995 consumers charged $372.3 billion on Visa cards. American Express says it has 37.8 million cards in circulation on which $161.6 billion in purchases were charged last year.

American Express does not release breakdowns on how much was charged for each kind of service or product. But Edwards said the volume of charges in restaurants is $16.8 billion for Visa, $17 billion for American Express - nearly the same. That helps explain why the two systems are dueling over the lunch and dinner table.

All credit cards result in a fee being charged the merchant - one that may be factored indirectly into the prices merchants charge to their customers. …

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