In 2005, Discover Financial Services acquired Pulse, an electronic funds transfer network, allowing it to market and issue debit and ATM cards.
[6] After a trial period in 1985, starting with a $26.77 purchase at an Atlanta Sears on September 17,[7] the actual launch was pushed through by Philip J. Purcell and Mitchell M. Merin, the company's senior vice president for corporate administration and manager of financial analysis, respectively.
Early Discover Cards bore a small embossed symbol representing the Sears Tower, then the company's headquarters.
It carried no annual fee, which was uncommon at the time, and offered a typically higher credit limit than similar cards.
Cardholders could also earn a "Cashback Bonus", in which a percentage of the amount spent would be refunded to the account (from 1% to 5%), depending on how much the card was used.
Sears began to face difficulties in the late 1980s in light of these developments, and with strong competition both from Walmart and from so-called category killers such as Toys "R" Us.
[14] In 1993, Sears spun off its Dean Witter division into a new publicly-traded company,[15] and began to accept MasterCard and Visa in addition to its store credit card and Discover.
[18] Starting around 2005, to increase acceptance around the world, Discover has formed several agreements with other payment networks internationally.
Shortly after the 2004 Supreme Court ruling, Discover struck its first deal to have its cards issued by another financial institution, GE Consumer Finance, which began to issue credit cards for retailer Walmart and its wholesale warehouse stores, Sam's Club.
Metris had originally signed an agreement with Discover in September 2005, three months prior to the HSBC acquisition.
In September 2012, Discover was ordered to pay over $200 million in fines and customer reimbursements to settle accusations by U.S. federal regulators that it had engaged in deceptive telemarketing tactics.
[24] In February 2024, Capital One announced that it would acquire Discover Financial Services in an all-stock transaction valued at $35.3 billion.