After VISA and MasterCard—the two most commonly accepted "plastic" at a wide variety of business establishments worldwide, one finds in the second tier Discover Card and American Express, often abbreviated Amex. This article will provide an introduction to those two cards.

Discover

Discover is the most recent arrival of the top four cards, and—unlike VISA, MasterCard, and American Express—it focuses on the Americas rather than a global market. Introduced in 1985 by Sears, Discover Card joined Dean Witter Reynolds Organization

and Coldwell, Banker & Company, Sears's 1981 purchases, to become the Sears Financial Network.

Discover had several other differences from the other three top cards when it was unveiled during the 1986 SuperBowl:

• At its inception, it took the then-unusual step of having no annual fee;
• It generally offered a higher credit limit than the other cards;
• It offered a Cashback Bonus to cardholders based on their purchases of 2% at a time when this was not done;
• It was accepted by US Customs, which the other cards were not;
• It was payable at Sears stores, an added convenience for some customers at a time when fewer people handled all their monetary transactions on-line.

The close Sears ties loosened in the late 1980s, and Sears sold the Sears Financial Network in 1993, whereupon Discover became part of Dean Witter. In 1997, Dean Witter merged with Morgan Stanley. In 2005, Discover turned to debit and ATM cards with the acquisition of an electronic funds transfer association, PULSE.

Up to this point, most Discover Cards had been issued through Discover Bank, but Discover added HSBC in 2005 and GE Consumer Finance as well. After originally making plans to spin off Discover in April, 2005, Morgan Stanley finally divested in June, 2007, when it became an independent company.

Today, Discover has more than 4,000,000 merchants in its network and more than 50 million cardholders, while its PULSE ATM network serves more than 4,400 institutions and nearly 260,000 ATMs and POS terminals. In 2006, Discover and PULSE combined for a total of greater than 3 billion transactions.

American Express

American Express is a brand of charge and credit cards offered by American Express Company, which provides global financial services from its New York headquarters. American Express was founded in 1850 as an express business when three express mail companies—

• Wells & Company
• Livingston, Fargo & Company and
• Butterfield, Wasson & Company—

emerged.

The growth of American Express took a variety of forms. Early on it affiliated with other express companies, as well as other forms of transportation, including railroads and shipping. On another front, it initiated a money order business in 1882, and—after J.C. Fargo had a difficult time securing cash on a European trip—the American Express Traveler's Check was developed and launched in 1891, giving American Express global connections. Its travel Division was established in 1915.

When the railroads were commandeered and the express companies merged  to support the military efforts of the country in WWI, American Express gave up its express business and became known as American Railway Express Agency in 1918. The company entered the card business in 1958 with a charge card that charged an annual fee of $6. They were the first to use the plastic cards that are similar to those seen today in 1959.

Continuing the development of its charge card business, American Express introduced the Gold Card in 1966, the Platinum Card in 1984, their first credit card, the Optima, in 1987, the Centurion card in 1999, Blue from American Express in 1999, and Clear and One in 2005. An ExpressPay feature that has a special reader in front of which one simply waves one's card was introduced in 2005, as well. The UK division introduced a Product Red card in 2006 through which card member purchases are used to fund contributions to causes such as funds to help people with HIV/AIDS. And in 2007, the Plum Card, which offers a discount for early payment, was introduced.

Disclaimer: This content is not provided or commissioned by American Express.  Opinions expressed here are author’s alone, not those of American Express, and have not been reviewed, approved or otherwise endorsed by American Express.  This site may be compensated through American Express Affiliate Program.