Wells Fargo & Company (WFC) and American Express Company (AXP), also known as AmEx, recently announced a partnership wherein credit cards issued by the former will be accepted on AmEx network. The new credits cards will be available in the market by mid-2014. However, the terms and conditions of the agreement are yet to be disclosed.
As part of the partnership deal, AmEx with its Partner Advantage capabilities and services will help Wells Fargo in formulating a range of products with exclusive benefits and customized offers. Moreover, LoyaltyEdge from AmEx will help in preparing a loyalty program in which Wells Fargo’s customers will be able to redeem a wide range of merchandise and gift cards with their points.
As per Wells Fargo’s Consumer Lending Group head Avid Modjtabai, the partnership will result in enhanced services for customers in the form of rewards and benefits, thus increasing the client base in the long run.
Looking back, we find that Henry Wells and William Fargo were the common founding heads of these companies. Consequently, the symbiotic partnership was a welcome move that is expected to help AmEx expand its global network while boosting Wells Fargo’s credit card business.
Notably AmEx has consistently partnered with merchants across the world in order to strengthen its global foothold. On May 29, AmEx had announced a similar partnership with Citigroup, Inc. (C) wherein cards issued by Citi in the Asia Pacific region will be accepted in AmEx global merchant network.
Earlier, in Jan 30, Barclaycard – a unit of Barclays PLC (BCS) retail and business banking – became American Express’ card issuing partner in the U.K.
Currently, Wells Fargo carries a Zacks Rank #2 (Buy) while AmEx has a Zacks Rank #3 (Hold).
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