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Last Updated: Friday, 30 January, 2004, 08:03 GMT
US credit card battle hots up
A credit card being swiped through an electronic reader
Amex wants to expand its US network
Two of the biggest US credit card issuers have teamed up, striking a deal for bank MBNA to issue Amex cards.

The deal was made possible by an anti-trust ruling that found Visa and Mastercard were wrong to ban their card issuers from linking with rival Amex.

That ruling is being appealed, and the case could go to the Supreme Court

The new cards cannot be rolled out until the legal battle ends, though Amex and MBNA say they expect to start issuing them this year.

'Jumping the gun'

Mastercard issued a statement saying the tie-up, was inappropriate because it "implies that it knows what the Supreme Court will do".

Mastercard and Visa have appealed against the anti-trust ruling that gave the go-ahead for their card issuing banks to team up with rivals, making clear their willingness to pursue their appeal to the Supreme Court if necessary.

The anti-trust case against them was brought by the US Justice Department.

MBNA is the second biggest credit card issuer in the US, with just over 12% of the domestic market, making it a major issuer for Visa and Mastercard.

Amex has 5.6% US market share, according to a survey by UBS Investment Research.

Amex chief executive Ken Chenault hailed said the agreement with MBNA would change the landscape for borrowers by providing them with better value and more competitive options.

"Today's news marks a fundamental change in the US credit card industry and we believe it will lead to better value and greater choice for consumers," he said.

Amex has said it is continuing to negotiate similar tie ups.

Amex and MBNA issued no financial details of their deal.




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