American Express Co. had been pitching a shutout over Discover Financial Services Inc., in terms of issuing partnerships, in the months since the Supreme Court upheld an antitrust verdict over Visa and MasterCard.

But the high-visibility partnership that Discover announced Friday with GE Consumer Finance and Wal-Mart Stores Inc. may presage a series of deals with more retailers.

Mark W. Begor, the president and chief executive officer of GE Consumer Finance Americas, said in an interview after the announcement that at least preliminary discussions were underway with other chains. "Most of our retail partners are talking to us in some way, shape, or form" about issuing dual cards, which work like private-label cards in stores and like general-pupose cards elsewhere, he said.

The partnership will have GE Consumer Finance provide card issuing services for the Bentonville, Ark., retailer. The new card, to be called the Wal-Mart Discover, will officially be launched in March but has been available to some Wal-Mart employees on a pilot-test basis for several months. (Wal-Mart used to offer a MasterCard issued by J.P. Morgan Chase & Co. under an arrangement that dated back to 1996 but it has been discontinued.)

Specific terms of the alliance were not released, but GE Consumer Finance did disclose that Discover, a Riverwoods, Ill., unit of Morgan Stanley, would not be picking up all the volume generated by the cards. Discover's network will carry only the transactions that occur outside Wal-Mart stores. The cards will function inside the stores more like private-label cards, operating over GE Consumer Finance's network - and reducing Wal-Mart's interchange payments.

Still, David W. Nelms, Discover's chairman and chief executive officer, said the deal would give it a "substantial" boost in transaction volume, though no substantial earnings increase.

"I view this as an investment year," Mr. Nelms said. "We are going to, in the long run, have a good payback. I think just as important will be second-order effects to acceptance."

The deal with GE Consumer Finance, a Stamford, Conn., unit of General Electric Co., could grow to encompass many other partners, Mr. Nelms said. "We are talking to lots of other people about issuing cards on Discover."

GE Consumer Finance is also developing a debit card that could use the Discover network, Mr. Begor said. It could involve customers using their card to access cash in an account established with the retailer or another account.

GE Consumer Finance has issued the private-label Wal-Mart card for years and has around 8 million cardholders, Mr. Begor said, some of whom will be offered the new Discover cards.

Gwenn Bezard, a research director at AITE Group LLC, called the agreement a "coup" for Discover. All three partners are "aggressive and committed," he said.

Discover's sales pitch to potential partners is that its merchant fees are lower, a feature it says will entice more merchants to accept the card. Mr. Nelms said this deal should help accomplish exactly that, even though it would not in itself boost earnings.

"The main thing we hear from merchants is they would like to see more volume on our network," Mr. Nelms said. Until the Supreme Court ruling Discover had "been hindered from being able to do so," he said. "This will help drive acceptance."

Until the court spoke, MasterCard's rules prevented its issuers, which include GE Consumer Finance, from partnering with Discover or American Express. American Express has two high-profile partners, MBNA Corp. and Citigroup Inc.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.

Corrected November 16, 2009 at 4:19PM: In the original version of this story misquoted Mark Begor, the CEO of GE Consumer Finance Americas, on discussions it has held with other retail chains whose private-label cards it issues. He said his unit had talked with most of them about issuing cards that, like the new Wal-Mart card, would also function as general-purpose credit cards - but he did not say the talks involved using the Discover network.