Inflation could benefit credit card behemoth American Express and payment processing giant Fiserv as long as price hikes don’t get out of control, the chief financial officers for both companies said in recent presentations.
Higher prices mean more payments volume, on a dollar basis, and that results in more revenue for New York-based Amex, Chief Financial Officer Christophe Le Caillec explained at the June 11 Morgan Stanley U.S. Financials Conference. That’s because merchants pay the company interchange fees, based on the size of the transaction, whenever an American Express cardholder swipes a credit card.
“It provides a bit of support for our revenue growth, and our expenses don’t travel at the same speed,” the CFO said in a question-and-answer session.