Don't have a cow? No worries. A new partnership between Zynga
Lots of competition in the mobile payments sector
American Express' Serve program is a direct swipe at eBay's
PayPal isn't the only rival Amex has its eye on. Google
Amex's Serve platform was launched only a few weeks ago, but the company has been marketing it heavily. The service is available through Facebook, and free mobile phone apps were rolled out right away. Fees are waived for the first six months, as well.
The new partnership with Zynga is somewhat convoluted, requiring a customer to sign up for both Serve and a prepaid, co-branded reloadable debit card. The card is loaded via cash, card, or bank account. The rewards part of the program comes in the form of Zynga Farm Cash, which customers apparently pluck from a Serve Money Tree that they plant on their virtual farm. With this Farm Cash, players could then purchase their cow.
The advantages of this new partnership to American Express is obvious. It gets to expand into a youth-oriented market, stuffed with millennials who prefer prepaid debit cards to other types of conventional banking. It stands to make a pretty penny off of fees, once they begin to take effect: The company will take 2.9% of the amount transferred into a Serve account using a credit card, plus a $2 per-transaction fee for each ATM withdrawal after the first one each month.
Whether the alliance helps Zynga is less clear, as the company has been in a virtual free-fall recently and is now suffering from the Facebook fiasco as well as increased competition, with more on the way from the likes of Angry Birds.
Despite a bit of a rocky road over the past year or so, I would keep my eye on VeriFone. This company has a lot going on and is bound to start climbing out of the pits sometime soon.
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Fool contributor Amanda Alix owns no shares in the companies mentioned above.
The Motley Fool owns shares of Google. Motley Fool newsletter services have recommended buying shares of Google and eBay. Motley Fool newsletter services have recommended creating a write covered strangle position in American Express.
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