Diners Club International (“DCI”) is a wholly-owned subsidiary of DFS Services LLC, a wholly-owned subsidiary of Discover Financial Services (“DFS”). DFS is a publicly-held, U.S. company traded on the New York Stock Exchange (NYSE: DFS). DCI is a proprietary, global payment network comprised of 80+ licensee Participants. The Diners Club card is accepted globally and the licensees have operating rights to accept the card in more than 185 countries.
Each Participant operates under a license granted by DCI which may give the Participant the right to issue DCI cards to customers in a specific geographic territory, and/ or to establish and maintain relationships with merchants in order to facilitate acceptance of the Diners Club card. DCI acts as a franchisor and relies on our licensee franchises to facilitate issuance or acquisition of card transactions. As a franchisor, DCI has responsibility to:
- Maintain a network of viable and reputable franchise Participants.
- Expand the DCI brand by introducing new products, features, and consumer awareness.
- Establish network operating rules and to ensure compliance with contractual obligations, and operating rules to mitigate any potential risk to the network.
- Facilitate the data transfer of cross-border participant transaction activity.
DCI does not directly issue cards or direct the daily activities of merchant acquiring. DCI’s prime responsibility is to manage the association of network participants, as they perform their card issuer and acquirer activities.
Under the licenses granted to its franchisees, DCI has traditionally entered into exclusive arrangements with its business partners for issuing and/or acquiring. In instances where acquiring exclusivity has served to constrain business growth, DCI has taken the strategic decision to open up the market to improve acceptance. Within the EU regulatory environment, DCI is a three party card scheme, including sub-licensees. Although not a dominant market share player, DCI considers that three party schemes are an important source of competition and should not be subject to regulation of interchange fees.