A New Way to Co-Brand

First National Bank Omaha and Boscov's, a major department store in Omaha, NE, have created a new type of partnership in the co-branding credit card industry. Instead of a fee-based incentive program, the two companies are splitting the expenses and revenues of co-branded Visa cards.

Customers who hold one of the co-branded cards can use them either in the department stores or in other locations. Where the cards are used determines whether the store processes the account internally or the bank administers the transaction. Card users actually have two lines of credit on the one card and will receive two points towards rewards when purchases are made in the department store and one point for every dollar spent using the card elsewhere.

The companies say they were able to work out the program because of leading-edge technology and in-house processing systems that allow Boscov's to have more control than traditional credit card co-branded customers might have.

Copyright © 2003 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 13, No. 6, 8/03