What is a 'Discover Card'

Discover Card is a credit card brand known for its pioneering cashback rewards program, and is one of the most accepted credit card brands in the U.S. and around the world.

BREAKING DOWN 'Discover Card'

Discover Card is a brand of credit card offered by Discover Financial Services. Discover is one of the largest credit card brands in the U.S. and around the world, alongside Visa, MasterCard, and American Express. In contrast to Visa and MasterCard, Discover issues its credit cards directly through its own Discover Bank. As of 2016, Discover was the sixth-largest credit card issuer in the U.S., and the most widely-accepted credit card brand around the world.

The first Discover Card was issued in 1985 by securities firm Dean Witter Reynolds, which was then owned by Sears, Roebuck and Company. Upon launch, Discover Card became a popular alternative to other credit cards because holders were not charged an annual fee. Discover also pioneered the cashback bonus perk for cardholders, offering a percentage refund on purchases to cardholders who used the card frequently.

Today, the Discover Card is one of the flagship products of Discover Financial Services, which also offers a variety of direct banking products and services through its Discover Bank arm, including student loans, home equity loans, and personal loans.  Headquartered in Riverwoods, Illinois, in 2017 Discover employed 15,000 people.

Discover Financial Services also offers a host of payment services, including the Discover Network, a comprehensive payments network; PULSE, one of the largest electronic funds transfer networks in the U.S., and Diners Club International.

In 2015, thanks to a payment-network agreement established with China’s UnionPay,  Discover Card became the most widely-accepted credit card brand.

A Brief History of Discover Card 

1985: Dean Witter begins test marketing the Discover card. On September 17, 1985, a Sears employee used a Discover card for the first time, with a purchase of $26.77 in at an Atlanta Sears store.

1986: Dean Witter launches the Discover card nationally with a commercial broadcast during Super Bowl XX. The Discover Card is launched without an annual fee, and begins to pioneer cashback rewards to cardholders.

1989: The Discover Network signs its millionth merchant account in the United States.

1993: Sears spins off Dean Witter Financial Services as its own publicly-traded company.

1997: Dean Witter merges with Morgan Stanley.

1999: Discover Financial Services rebrands as the parent organization for Discover Card.

2000: Greenwood Trust Company, owned by Discover since 1985, is rebranded as Discover Bank.

2002: Discover introduces the first keychain credit card.

2005: Discover Financial Services acquires the PULSE payments network, and establishes a strategic alliance with China’s UnionPay, laying the groundwork for Discover to become the most widely-accepted credit card brand in the world.

2007: Morgan Stanley spins off Discover Financial Services as an independent publicly-traded company.

2008: Discover Financial Services acquires Diners Club International.

2012: The first Discover cards are issued internationally through banks in Ecuador and Russia.

RELATED TERMS
  1. Secured Credit Card

    A secured credit card is a type of credit card that is backed ...
  2. Credit Card

    Issued by a financial company giving the holder an option to ...
  3. Universal Default

    Universal default allows a credit card company to raise a card’s ...
  4. Stored-Value Card

    A stored value card is a type of electronic bank debit card.
  5. Card Recovery Bulletin

    A card recovery bulletin is published by credit card issuers ...
  6. Open Loop Card

    An open loop card is an electronic payment card that can be used ...
Related Articles
  1. Personal Finance

    Credit Card Review: Discover it (DFS, AMZN)

    Learn why the Discover it card provides a great balance between cost effectiveness and robust rewards, especially for those who travel internationally.
  2. Personal Finance

    Review: Discover it Miles Card

    This rewards card could be one of the most generous yet. See if it makes sense for you.
  3. Managing Wealth

    Review: Discover Checking Account

    Will having a Discover checking account save you money? It will save you fees.
  4. Personal Finance

    Credit Card Review: Discover it Miles

    Understand what makes a credit card valuable and possible drawbacks; learn about the Discover it Miles card and how it may benefit a consumer.
  5. Investing

    Discover Q4 Profit Beat Driven by Higher Loans

    Thanks to a 7% rise in total loan balances, Discover beat Wall Street's fourth quarter estimates on revenue and profits.
  6. Personal Finance

    American Express's Main Competition

    American Express competes with Visa, MasterCard, and Discover Financial Services in the credit card space. It also competes with banks to draw consumers.
  7. Investing

    Discover Declares 30-Cent Quarterly Dividend

    The cash dividend of 30 cents per share is payable on Feb. 23 to holders of record as of the close of business on Feb. 9.
  8. Personal Finance

    3 New Types Of Credit Cards To Look For

    These three types of credit cards are becoming popular with customers looking to pay less fees and build up their credit scores.
  9. Personal Finance

    Best Credit Card Features For Students

    Students should look for credit cards that charge no annual fees, have a low introductory interest rate and offer rewards or money.
  10. Personal Finance

    Top Credit Cards with 2% Cash Back

    Some of our favorite things: credit cards that give you cash back. But which one's the best deal for you? Here's why not all credit cards are equal.
RELATED FAQS
  1. What Are Prepaid Credit Cards Versus Gift Cards?

    Although prepaid and gift cards are used in the same manner, a prepaid credit card can be used repeatedly, while a gift card ... Read Answer >>
Trading Center