American Express Co , which is trying to move beyond its traditional credit card lending business, is hoping MasterCard Inc's head of prepaid debit products can help expand its offerings.
American Express has hired Laura Kelly to oversee its new product development and marketing, according to an internal memo obtained by Reuters.
Kelly will be responsible for building, launching and marketing all new products globally as a senior vice president in the company's global payments options group, according to the memo sent last week by that group's president, Alpesh Chokshi.
She joins American Express from MasterCard, where she ran the payment processing network's prepaid debit business. Prepaid cards, which can be used like debit cards but do not have to be linked to a bank account, are a small but rapidly expanding sector of the payment industry. They are sold mostly to young or poor people who do not have bank accounts and who mostly use cash.
Kelly really helped to put prepaid on the map, not just for MasterCard but for the industry, said payments industry consultant Philip Philliou, a former MasterCard and American Express executive who has worked with Kelly.
American Express is very open about wanting to go after new types of customers, with new fee services ... and prepaid is certainly a nice springboard for that, he said.
Banks, marketers, and card networks like MasterCard and Visa Inc are increasingly trying to build up their prepaid businesses, as a saturated U.S. market and increasing regulation are limiting the growth of traditional credit and debit card businesses.
While American Express does not currently offer debit cards, it is trying to get a foothold in new types of payment technologies, including online, mobile and prepaid. Last year it hired Daniel Schulman from wireless operator Sprint Nextel Corp to oversee a new enterprise growth unit.
In her new role, Kelly will report to Chokshi, whose group is within Schulman's unit. She will start at American Express on May 16, according to the memo.
A MasterCard spokesman did not respond to an email seeking comment. The Purchase, N.Y.-based network in March promoted Ron Hynes to take over its global prepaid solutions group, saying at the time that Kelly had voluntarily elected to pursue another opportunity.
(Reporting by Maria Aspan; Editing by Tim Dobbyn)