Visa Announces it Can Live With Pulse, For a While at Least

ARLINGTON Va.- Now that the Pulse EFT network has merged with Discover, is there still room for both its logo and Visa’s on debit cards? Apparently yes, at least of now, according to a new set of policies that Visa, the nation’s largest card brand, announced this week. According to the new policy, Visa will continue to allow financial institutions who are members of the Pulse EFT network for their debit transactions in which cardholders use a personal identification number to put the Pulse logo on their debit cards which also carry the Visa brand. Questions had arisen about the two brands sharing the same card turf after Pulse merged with Discover in January 2005. Visa’s policies normally do not allow the logos of competing general purpose cards to share card space with its brand. But the card association said it had found a way to allow the Pulse logo to stay. “The modifications Visa is announcing today are part of Visa’s ongoing effort to keep pace with the rapid changes in the dynamic and extremely competitive payments landscape,” said Elizabeth Buse, executive vice president with Visa. “Recognizing that cardholders generally distinguish between PIN debit transactions and Visa transactions, Visa undertook these rule changes to better accommodate Member and merchant desire to offer multiple payment options to their customers,” Buse added. “What this translates into is Visa not wanting to pick a fight with Pulse that might require some of its large member issuers who also belong to Pulse to issue entirely new plastics,” according to Scott Reaser, senior consultant with First Annapolis Consulting, a card consulting firm headquartered in Maryland. But the compromise may be tenuous since Visa’s vice president David Cohen has made it clear that if Discover tries to make the Pulse brand into a debit card with which cardholders validate their transactions using their signatures, the card brand may have to reevaluate its decision. Cohen explained that the current policy change had been built more on the recognition that the existing cards that carry the Pulse logo are not general purpose cards in the same way that it, MasterCard, American Express and Discover are. Should that change, Cohen said that Visa position may change. Reaser said that it would be unlikely that there would be any fight between the brands soon since, in the event of a conflict, financial institutions would have to choose between offering a debit card branded with Visa and one branded with Pulse/Discover. “I am not saying that Pulse could not make a pretty strong offer to get financial institutions to switch, but Visa is in a pretty strong position already,” Reaser observed. For its part, Pulse said that is appreciated Visa’s decision and that it expected to continue to share card space with the national brand into the future. Based on the latest industry data, Visa leads the nation in locations which accept its cards with 5.7 millions, MasterCard has 5.6 million, Discover comes in with 4.4 million, American Express with 3.7 million and Diner’s Club with 2.1 million. -