GE Capital Business Services, Stamford, Conn., has introduced a charge card designed to give small businesses the purchasing power of large corporations.
The GE Corporate Plus Visa charge card offers cardholders a 5% rebate on all air travel and 3% back on Exxon gasoline, as well as discounts from marketing partners, including Hertz, Hyatt, Radisson, Airborne Express, and Boise Cascade office products.
The announcement comes less than a month after the card issuer's Consumer Financial Services unit in Cincinnati released corporate and procurement MasterCard programs, geared for the largest corporate customers.
Visa U.S.A.'s new rules on nonduality for commercial cards are not scheduled to go into effect until 1996, but GE's delineation of programs already fits in with the regulations.
"Our position has been to encourage those members who might only be issuing MasterCard commercial products to issue a Visa (program) so they can make an informed choice when the time comes - like a bake-off," said Robert Levaro, senior vice president commercial card products, Visa International.
But he said that under the new regulations, issuers may choose to offer a Visa small business card program and a MasterCard corporate or procurement card at the same time.
While MasterCard International spokesman Michael O'Brien said the association supports duality, Mr. Levaro said Visa's position against dual programs boils down to technology.
"In a dual environment it will be hard to take a radically different direction (than MasterCard) in terms of technological innovation," he said.
When processing a program, issuers find it easier to run both brands through similar software and equipment. If programs were to be advanced or altered, approval of both associations would be necessary.
"We don't want to be compelled to work lock step with MasterCard to the detriment of customers," said Mr. Levaro.
Anne van Geldern, vice president of card products for GE, pointed out that Visa has done extensive research in the small to medium business market. "When we were evaluating a brand, Visa brought a lot of knowledge, particularly in terms of reporting and enhancements and card processing, helping us validate some of our product design."
On the other hand, she said MasterCard's strategy is focused on the midsize to large corporations.
Over the next couple of years, GE would like to capture 10% of the fast- growing small business card market by attracting new business, as well as luring some of American Express Corp.'s customers.
"We know that Amex has a million cardholders in this segment," she said. "We think we have something else to offer because of Visa acceptance and the discounts."
With an 800 number customers can book flights, order office supplies, and make long-distance phone calls at a discount without surcharges.
Cardholders will also benefit from a comprehensive reporting package that provides expense tracking by cost center and product category, and highlights purchases and savings earned through the GE Corporate Plus network of business partners.
The card has no interest rate, but there is a tiered annual fee, depending on the number of cards issued. Ms. van Geldern declined to divulge the price, but said it would be cheaper than American Express' $55 fee.
