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It’s so strategic and compelling,” Schatt said. “Banks have never been able to penetrate the cash or check market, and cash still dominants. The reality is, people will still pull out $200 to $500 from the ATM and dole it out for various payments over several weeks, or they write checks and banks don’t benefit.”
Discover can use it as a way to find new customers and increase transactions on its network. It’s also, potentially, a defensive move against other technology companies, such as Amazon, Google and Apple, which are likely prepping payment services of their own.
People who receive money from a Discover member will be given the opportunity to sign up for a card.
Mobile
In a statement, Mike Boush, Discover’s VP of its Ebusiness, said: “This offering provides Discover cardmembers with another way to help them earn rewards on more types of purchases and give them the ability to consolidate and track more of their spending on one payment vehicle.”
A Discover customer does not have to have a PayPal account, and it is free to send cash to people. In fact, the payment is treated as a purchase transaction, so members will receive cash back for every transaction, which roughly equates to .25 percent for the first $3,000 spent
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