InComm to buy Serve platform, become exclusive Amex prepaid distributor
American Express and InComm have entered into an agreement for InComm to acquire the exclusive distribution rights of Amex’s prepaid reloadable and gift card products in the US, including Bluebird and Serve.
InComm also will acquire the Serve technology platform and other assets related to the American Express prepaid reloadable and gift card products business.
American Express will remain the issuer and network for all products involved in the transaction, but InComm will become the programme manager and processor.
“In designing our prepaid portfolio, we set out to create best-in-class products that would provide alternative access to financial services outside of the traditional banking sector,” says Stefan Happ, executive vice-president and general manager, global prepaid and alternative payments, American Express. “The transition of programme management to InComm will allow us to grow the business and continue to offer these best-in-class options to our customers.”
Atlanta-based prepaid technology company InComm has been a 15-year partner of American Express and already provides the retail activation points for its gift and GPR programs, as well as its reload network.
Acquiring the Serve technology platform will expand InComm’s processing capabilities, as well as ensure continuity for customers and retail partners, says InComm president Phil Graves.
Financial terms of the acquisition, which is expected to close in the first quarter of 2018, were not disclosed.
In additional to the technology, InComm “is excited to be acquiring talented employees with significant prepaid expertise and institutional knowledge that will help grow the business”. The exact number of employees moving over to InComm is still to be determined, but InComm’s COO and CFO Scott Meyerhoff estimates around 300 employees work on Amex’s prepaid business.
Also to be determined is what the new programme management and distribution relationship will mean for the pricing and features of the American Express prepaid portfolio. American Express brought Serve to market six years ago with almost no fees.
One of the things that made its pricing structure possible was its vertical integration – serving as issuer, programme manager and network.
While neither company provided details on the economics of the new relationship, Meyerhoff says InComm will be evaluating the pricing and features of American Express’ prepaid products to determine what consumers want.
“We’ll evaluate based on what people are buying and what people like,” he tells Paybefore. “We’ve done a lot of research, but we’re also going to be doing a lot of listening to find out what works best for the customers and for our retail partners. We will do right by the customers.”
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