In an effort to increase the speed and efficiency of money transfer through mobile phones, PULSE, a subsidiary of Discover Financial Services (DFS) signed an agreement with Obopay Inc., a California-based company that specializes in mobile payment technology and services. Consequently, PULSE’s debit card customers will be able to transfer their money instantly through mobile phones using Obopay’s ‘Mobile Money for Banks and Credit Unions.’
Additionally, debit card holders will be able to receive payments from other financial institutions immediately into their accounts. Moreover, the customers will be able to use their debit card numbers for mobile payments, instead of the usual bank account and routing numbers.
Obopay’s instant person-to-person and account-to-account money transfer service across financial institutions and payment networks is one of its kind. Money transfer using Automated Clearing House usually takes a few days.
However, in today’s fast-paced world people want instant services. Hence, real-time mobile money-transfer is expected to be popular and increase Discover’s mobile payment clients. Additionally, immediate money transfer is beneficial for financial institutions as it reduces the risk of inadequate funds in accounts.
Moreover, PULSE’s client institutions can use their existing connectivity and network process with PULSE to utilize Opobay’s service. They do not need any special system integration for the same, making it easier for them to offer the service to their clients.
Discover is constantly on the lookout for alliances to enhance its customers’ experience, boost its card acceptances and enhance its competitive strength against bigger card companies like MasterCard Incorporated (MA) and Visa Inc. (V). In November 2011, Diners Club International, a unit of Discover, had inked a merchant acquiring agreement with WorldPay to boost the acceptance of Discover and Diners Club cards. Additionally, WorldPay will start supporting Discover’s EMV-compliant payment solution – D-PAS.
Earlier, in October 2011, Discover’s subsidiary PULSE signed a long-term deal with Nebraska-based NETS Inc. for ATM and debit transactions, which substantially increased the acceptances of Discover’s PULSE, Diners Club and Discover Cards in the U.S.
Discover currently carries a Zacks #1 Rank, which translates into a short-term ‘Strong Buy’ rating.
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