Amazon.com, San Francisco and Internet consumer-credit provider NextCard Inc., have crafted a strategic relationship to create customized credit card products for Amazon's 13 million customers to use online and offline.
Under the terms of the agreement, NextCard--creator of the First True Internet Visa--will be the exclusive provider of a co-branded Amazon.com NextCard credit card. During the five-year term beginning in early 2000, the relationship is expected to generate $150 million in fees for Amazon.com as its growing customer base adopts the card.
The receivables generated from the Visa or MasterCard accounts, as well as the co-branded cardholder relationships, will be assets of NextBank, a wholly owned subsidiary of NextCard.
Amazon.com has also obtained a warrant to acquire up to 4.4 million shares of NextCard common stock, a stake of nearly 10%.
