Discover is now part of Capital One • Hacker News Board

Re: Discover is now part of Capital One

#31

Post by lxgr » Mon, May 19, 2025, 5:04 PM UTC

Boogie_Man wrote: post #19

datadrivenangel wrote: post #8

Earlier quoted context omitted.

Competing with VISA and the others is their goal here.

This is the correct answer. Discover has a payment network, which will afford Capital One the option to issue cards without relying on Visa or MasterCard. This is what Amex does. I would assume primarily domestic cards (platinum, quicksilver, savor) will start being issued on the discover network, while travel cards (venture series) will not (initially) because of the high domestic and low international acceptance ra…

Discover acceptance abroad is actually not as bad as it might seem at a first glance: Discover owns Diners Club International, and as a result Discover cards are accepted everywhere Diners Club cards are and vice versa.

They also have some mutual acceptance agreements with JCB and China UnionPay and others. Just because there's no explicit Discover logo on a terminal/restaurant window doesn't mean a Discover card will actually not work.

It's not quite the reach of Visa or Mastercard, but international acceptance seems to be trending up.

Re: Discover is now part of Capital One

#32

Post by lxgr » Mon, May 19, 2025, 5:05 PM UTC

mindslight wrote: post #10

digdugdirk wrote: post #3

I was wondering when the questionable corporate consolidation would start kicking off under the Trump administration. Have there been any other mergers in the past few months that slipped under the media radar? I honestly expected there would have been some deals waiting in the wings prior to the election just in case.

Three major online-first banks was clearly just way too much competition. This merger fixes the situation down to the "token two" where they only have to compete on marketing rather than anything relating to actual features like product offerings, fees, website usability, customer service, etc. Now they can switch to shameless extraction mode like the regional and national brick-and-mortar banks.

Which one is the other one?

Re: Discover is now part of Capital One

#33

Post by mbesto » Mon, May 19, 2025, 5:05 PM UTC

christophilus wrote: post #6

I know nothing. But this is an interesting acquisition. Capital One strikes me as a pretty well run org. Why would they want Discover, who notoriously targets the low end of credit card custom? My guess is that this gives them the ability to increase margins by owning the entire payment layer all the way through distribution. If they slash the fees charged to merchants, this could make them quite a powerhouse.

First, "Capital One strikes me as a pretty well run org" != "it's clients' sophistication"

Second, Capital One also targets low end (subprime), especially relative to Amex, Visa, etc.

Re: Discover is now part of Capital One

#34

Post by colechristensen » Mon, May 19, 2025, 5:07 PM UTC

josefritzishere wrote: post #27

colechristensen wrote: post #16

Earlier quoted context omitted.

Fining the CEO for not filing the correct paperwork when acquiring large amounts of company stock doesn't really seem like it should block a merger.

[flagged]

>The complaint alleges that Fairbank failed to report his sizable stock windfall to federal antitrust authorities and illegally finalized the acquisition before the agencies could investigate.

He got $20M worth of shares of Capital One stock which is overall worth $76B, so yeah, I'm quite dismissive of the crime of not following antitrust regulations for a transaction involving 0.03% of company value. The authorities were never going to have anything to say about these transactions, they're just mad they didn't get the opportunity to choose to not do anything. Sure, fine him, but this is like a parking ticket.

Re: Discover is now part of Capital One

#35

Post by ravenstine » Mon, May 19, 2025, 5:09 PM UTC

Though I don't know much about Capital One – I did have a credit card with them a long time ago, and I just remember their website/app being just OK.

I do hope this merger doesn't degrade Discover since I've been very happy with them in pretty much every way (both bank and credit).

Re: Discover is now part of Capital One

#36

Post by Boogie_Man » Mon, May 19, 2025, 5:10 PM UTC

lxgr wrote: post #31

Boogie_Man wrote: post #19

Earlier quoted context omitted.

This is the correct answer. Discover has a payment network, which will afford Capital One the option to issue cards without relying on Visa or MasterCard. This is what Amex does. I would assume primarily domestic cards (platinum, quicksilver, savor) will start being issued on the discover network, while travel cards (venture series) will not (initially) because of the high domestic and low international acceptance ra…

Discover acceptance abroad is actually not as bad as it might seem at a first glance: Discover owns Diners Club International, and as a result Discover cards are accepted everywhere Diners Club cards are and vice versa. They also have some mutual acceptance agreements with JCB and China UnionPay and others. Just because there's no explicit Discover logo on a terminal/restaurant window doesn't mean a Discover card wil…

Agreed - The ability to further increase that international acceptance rate leveraging existing relationships and cardholder numbers is a large part of the 35.3 billion dollar gamble Cap1 is making, and I'm willing to bet it pays off big time.

I'm riding high on Cap1, personally.

Re: Discover is now part of Capital One

#37

Post by jldugger » Mon, May 19, 2025, 5:12 PM UTC

trollbridge wrote: post #26

xyst wrote: post #12

It’s Ticketmaster and LiveNation all over again. Business owners going to get gouged. Customers going to see price of items go up as business owners pass along increased transaction costs. Yes - this will also impact you even if you don’t have a discover/capital one card.

Soon you'll have to put up a "no Discover accepted" sign right next to the "Amex not accepted" sign.

I suspect the trick here is that capitalone issues so many other cards that once they standardize on it, merchants can't refuse their network without losing substantial amounts of business.

Re: Discover is now part of Capital One

#38

Post by baggachipz » Mon, May 19, 2025, 5:15 PM UTC

DaSHacka wrote: post #28

baq wrote: post #9

Earlier quoted context omitted.

[flagged]

This administration causes webservers to be over capacity?

It does if they decommission most of them in the name of "efficiency". You may recall the same thing happening to Twitter at the behest of its new owner, who happens to be the new owner here as well.

Re: Discover is now part of Capital One

#39

Post by the_optimist » Mon, May 19, 2025, 5:17 PM UTC

Cool. Great company, more competition among the payment networks should result in better and less expensive products. Maybe Discover will finally achieve its potential.

Re: Discover is now part of Capital One

#40

Post by mindslight » Mon, May 19, 2025, 5:21 PM UTC

lxgr wrote: post #32

mindslight wrote: post #10

Earlier quoted context omitted.

Three major online-first banks was clearly just way too much competition. This merger fixes the situation down to the "token two" where they only have to compete on marketing rather than anything relating to actual features like product offerings, fees, website usability, customer service, etc. Now they can switch to shameless extraction mode like the regional and national brick-and-mortar banks.

Which one is the other one?

Ally. There's also Alliant Credit Union which I left out because I think their website/app usability is abjectly atrocious (and my statement was still technically correct because CU).

Admittedly I haven't kept up with new options in the past few years, but my main goal is stability for not having to redo all the setup so new startupy options are kind of inherently uninteresting.