Bringing Amex Back to Curve

amex

#92

Well said Sharka! I grow so weary of all this het-up fighting talk against a company with a greater Market Cap than Goldman Sachs.

I imagine Wire Card Solutions (the FCA registered company managing all of Curve’s transactions) would need to be involved in any proceedings, they haven’t been mentioned once, and are yet to release a statement.

AMEX make very little Margin in the EU due to fee caps, and if they did lose the case with Curve (highly doubtful IMO) they could just leave the market. I would be furious to see AMEX stop issuing UK cards.

Seems like we are all playing along though, as what we could/should be discussing is how Curve is going to cover its costs and pay up the currently suspended referral fees.


#93

I would love to see Amex leave the EU market because of this. If you can’t compete with MC and Visa you should not exist.


#94

Has nothing to do with competition - they have a different business model (that many Curve Customers also appreciate). Can hardly label them a failing business at the moment.

Aside from TechCrunch most of Curve’s publicity seems to have come from Travel Blogs - I doubt your average reader of those blogs shares your enthusiasm for AMEX leaving Europe.

Long way from that, doubt AMEX is going anywhere.


#95

In a legal sense, since Curve had no official partnership with amex, it is indeed irrelevant what amex US thinks or not.

Amex is long known to take frivolous action against other players, just like when it recently lost the case where it claimed their card issuing partnerships didn’t constitute a 4 party agreement.

Given Amex’s track record with EU regulations it isn’t hard to believe that once again they are in the wrong, especially when there is no evidence Curve was doing anything it could not have. Their legal counsel, probably US based, has shown to not have much knowledge when it comes to the intrincacies of EU regulation and legislation


#96

If Curve was operating under a standard merchant agreement and obtaining permission from Amex to roll the feature out wasn’t necessary, why have they been “working closely” for months to bring Amex back? Why do it as a wallet top-up? Why have various meetings with Amex? Why the closed beta? Surely none of that would have been necessary if the deal was a simple merchant agreement akin to Visa and MasterCard.

It just doesn’t make sense to me.


#97

That is the same I can do with PayPal or Multibanco payments here in Portugal. I’m not saying you can’t use curve for cash recycling, just that with Curve it’s not easier or harder than with other methods, so Curve is not really facilitating anything


#98

That seems more of a problem with the way credit cards in some countries are set up. Here in Portugal you can withdraw money from most credit cards and they don’t charge any cash advance fees. No one seems to have a problem with that and it doesn’t seem to lead to any nefarious result to the credit card companies


#99

It was exactly to try to accommodate Amex’s wishes. Sure, they could have done it without amex, but it’s always good to have a positive business relationship as even when you’re right legal battles cost money and disrupt the services you’re providing to your costumers


#100

@megamaster

It is not clear to me why Amex seeking clarification from the ECJ is “frivolous”. The economic effect of the interline capping legislation has been to destroy the loyalty credit card sector in the UK: every single MBNA co-branded airline credit card has been terminated because the 0.3% does not cover the benefit costs. Amex is exempt from this cap for its own cards because it is issuer and (in the UK) owns the network.

Amex argued that merely putting, say, a BA logo on their directly issued card should not lead to a cap of fees to 0.30%, not least as they probably now lose money on their BA and SPG products in the UK. This is a perfectly sensible line of argumentation and, whilst the ECJ decided against them (many legal academics would say wrongly), it was in no way “frivolous”. Read the judgment: http://curia.europa.eu/juris/document/document.jsf?text=&docid=199181&pageIndex=0&doclang=EN&mode=req&dir=&occ=first&part=1&cid=554306

The EU legislation is, in many ways, misguided and works against consumers’ interests in the UK: it deprived them of the choice of loyalty credit cards.In the rest of the EU, the effect was less pronounced because the loyalty credit card sector was much smaller, possibly because the banking sector is much less competitive (i.e. another genuine consumer disbenefit).

What would, most probably, be frivolous is Curve bringing suit under the heads it suggests in its inflammatory communications after, it now seems, they launched a product knowing that Amex would not support it. Moreover, Curve seems to have no regulatory licenses whatsoever: unlike Amex, for example.


#101

Whilst I am not a legal professional, and fairly certain neither is Megamaster (though I have found him, Lucas and Sharka a useful source of information in previous threads)…

All this Legal talk completely overlooks the fact that Wirecard have remained silent throughout (I am sure they were invited to comment), and their shares have tanked this week on news “the German financial regulator and prosecutors in Munich have opened up a preliminary investigation into the payments company”.

I do not see how Curve can take any action against American Express without the backing of Wirecard - I do not see why Wirecard (that has contracts with multiple Fintech startups) would want a part in that battle - certainly don’t see Wirecard wanting to open themselves to a slogging match with AMEX (that could well orientate around transaction controls).

With that in mind can’t Curve just move on? I appreciate this has been frustrating for them (has an air of Nintendo vs Sony in the 90s), though I don’t see how unleashing customers to level unsubstantiated claims again AMEX helps anyone.


#102

While certainly I am no lawyer, I had several law classes in University as part of my business degree. I also had a merchant agreement with an acquirer bank that included amex acceptance for a small side business I ran. I had a run in with amex (for refusing amex as a method of payment for bills less than 50 Euros), in which they ended up having to idemnify me, so maybe my view on amex is tainted by that, but it looks like the same kind of move amex is now trying to pull on curve.

Edit: amex flying in a lawyer from the UK who didn’t know what the hell he was talking about didn’t help their case. The guy brought to support his argument previous rulings in Portugal that he probably had someone else fetch for him, totally ignoring that the law had since changed and most importantly that in Portugal precedent is not a judicial concept. No one cares about previous rullings, each case is judged on its own based on the letter of the law


#103

I find the interchange fee excuse is way overblown. Here in Portugal and other countries we have the exact same cards we had before, with the same benefits, some new cards even better than existing ones. It seems credit card companies in the UK are taking the excuse and running with it to reduce benefits for cardholders


#104

@megamaster

I do not know the Portuguese credit card market intimately, but I do not think it had, or has, cards that offer 20,000 or more airline miles on acceptance and an earnings rate of 1+ miles per £. In fact, I have always found continental European credit cards to have exceptionally poor benefits, very unlike the UK, US and the like. So, to the extent that nothing has changed, perhaps that was because they were just very consumer-unfriendly to begin with.

More topically, there are reports (e.g. comments of HfP) that Amex charges topping up Curve wallets have now disappeared from Amex accounts, in which case Curve will have to be funding any money paid out without the money coming in.

So, I hope that Curve has a few million in liquidity lying around to fund this and, of course, their pending multi-million pound litigation (for that is how much it costs to bring a commercial case). If not, I imagine they won’t be around for very much longer. @city_tom @manu


#105

There are cards that give 2 to 5% straight cashback on everything, through a simple monthly statement rebate, tough no sign up bonus, no need for points or miles trickery and no annual fee.

If you really want miles, tough you’re getting a worse deal, they are pretty much the same as in the UK, but much better, 1 mile per euro spent with a 40€ AF and 35k sign up bonus and no spending requirement or 3 miles per euro spent with a 300€ AF and 85k signup bonus, with some cards in between that give 2 miles per euro.

And no one ever came up with interchange fee excuses to lower benefits


#106

@megamaster

I am unsure how a 2-5% rebate can be funded on a 0.30% interline fee (or any interline fee) so either the issuers are losing money on these cards (are they bundled with other services?) or there is some sort of (low) cap on the rebate.

If these are the correct dynamics, why spend any time on Curve? Just use the V/MC with the 2-5% rebate.

Can you provide some links to these products to see eligibility?


#107

None of the cards require any additional service to be contracted. As for how they make money, the cards are all dual scheme, with Visa/MC and Multibanco. Most transactions in Portugal are processed through Multibanco, where the interchange fee cap didn’t have any effect as Multibanco charged already way less than they can by the cap and the banks are co-owners of Multibanco as well as co-owners of the acquirer that has the exclusive rights in Portugal to connect to Visa and MasterCard payment networks, so they’re making money on more than the interchange fees.

As for the cards themselves, the ones from 2 to 5% cashback have limits, but they are all no AF cards, so you can easily have 3 or 4 of them and that’s where Curve comes in. There’s nothing easier than switching between the cards with curve and earn cashback with all of them.

Just as an example of some cards, there’s Bankintercard Gold, which gives you 5% on everything, up to 200€ of spend a month, then Cetelem Black gives 3% on restaurants, petrol stations and supermarkets, up to 100€ in cashback a year and Cofidis gives 2% on everything up to 200€ in cashback a year, but when you get to the limit, they’ll generally give you more allowance, it also has no traditional cc fees like cash advance or fx.

With these 3 cards you’re good for 20k a year and then you can get any 1% card as those don’t have any limits on cashback for use after you cross the 20k. You can also pay a card with another card and a lot of times that generates cashback, it’s specifically allowed to use a card to pay another card if they are not issued by the same bank

Curve makes it incredibly simple to use 3 or 4 cards and never run out of cashback. My average cashback for last year across all purchases was 2.7%, bearing in mind all of those cards have regular promotions where they’ll give say 5%, separate from any cashback yearly limit, towards online purchases for a month, or 1% extra if you pay with contactless, among others


#108

Up to 200€ cashback / month or only cashback of x% for max transactions up to 200€


#109

Might sound good in %, but that’s very low limits. I’d need a card where I can make several hundred thousand points each year.


#110

200€ spend/10€ in cashback


#111

Sure, most people will need more than what each card gives, but that’s not the point. All of those cards have no fees, don’t cost money to keep, so you can have 4 or 5 of them and use them all. Curve is great for that