Visa, First Data join to market debit cards.

Signaling a thaw in its relationship with the country's largest credit card processor, Visa U.S.A. has said it will team up with First Data Corp. to market debit cards.

The partnership calls for Visa and First Data to co-sponsor training seminars and conferences to explain the Visa Debit program to banks that engage First Data to process their credit and debit card accounts.

Visa Debit is the association's "off-line" debit program, under which cardholders can make purchases at retail locations with the amount to be deducted later from their checking accounts.

New Perspective

The marketing alliance is noteworthy because of First Data's connections to Visa's non-bank archrival in the card business, American Express Co.

American Express was First Data's sole owner until April 1992. At that time, the financial services giant shed 46% of First Data through an initial public offering of stock, later reducing its holdings to 22%.

Now that American Express has spun off the unit, Visa officials said they are more comfortable working with First Data.

When American Express was the sole owner of First Data, "it created a question about the degree to which Visa could have an alliance with a competitor," said Rosalind Fisher, a Visa U.S.A. executive vice president.

Both American Express and First Data are based in New York.

As of the first quarter of this year, First Data computers tracked 61.3 million credit card accounts for banks, according to company reports.

The vendor has consistently topped rankings in The Nilson Report of the largest processors of bank-issued credit cards.

First Data's partnership with Visa is part of an effort by the technology company to boost its debit card business.

Only about 90 of First Data's more than 1,200 bank customers use the vendor to track debit card accounts, according to Margaret Lehing, senior vice president of a new debit card unit First Data established this spring.

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