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Discover Financial (DFS) Expands College Payment Solutions

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Discover Financial Services (DFS - Free Report) recently announced that it will be supporting Phood’s new meal delivery plan on college campuses and allow access to merchants that run on the Discover network.

With this unique relationship, higher-education students will be able to sign up on a mobile application and add their meal plans. They would also be allowed to flex plan dollars on meal delivery like groceries, DoorDash food items, etc.

Managed via an easy-to-use application, students will be able to use a Phood Discover prepared card with their meal plans on the campus along with flex plan dollars that they can use for out-of-campus and delivery orders. With contactless payments rising by the day, mainly led by the pandemic, this move came in at the right time. This is evident from the fact that U.S. contactless volume surged 152% from 2019 to 2020.

Ever since the pandemic has hit the world, the entire process of ordering food has changed. As students are returning to their campuses, they will be able to leverage from this solution as they won’t have to spend money beyond their meal plans. This solution will first be launched at Creighton University in Omaha, NE, Rocky Mountain College in Billings, MT and Radford University in Radford, VA.

Phood and Discover Financial will be trying to launch this plan across the country throughout the school year. Phood will be able to reach out to more customers with this deal.

The pandemic obviously showed us the requirements of digital solutions. The app will provide more payment options to students on the campus and beyond.

This is not the first time that Discover Financial took such an initiative. It constantly forges strategic alliances to expand its global reach and boost its portfolio. The company constantly works on integrating choices on a wider scale for its customers to enrich their experience.

In July, it inked a deal with SIBS MB to enhance the global acceptance for both companies.

It also signed a new network contract with the market-leading digital payment solutions company and fintech enabler Arab Financial Services (AFS) to drive global acceptance for both companies.

Zacks Rank and Price Performance

Shares of this presently Zacks Rank #3 (Hold) company have soared a whopping 115.5% in a year’s time compared with the  industry’s rally of 98.4%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Zacks Investment ResearchImage Source: Zacks Investment Research

Stocks to Consider

Some better-ranked stocks in the same space are Credit Acceptance Corporation (CACC - Free Report) , Ally Financial Inc. (ALLY - Free Report) and  First Cash, Inc. (FCFS - Free Report) . While Credit Acceptance sports a Zacks Rank of 1, Ally Financial and First Cash hold a Zacks Rank #2 (Buy) at present.

Earnings of Credit Acceptance, Ally Financial and First Cash managed to deliver a trailing four-quarter surprise of 65.4%, 63.36% and 21.71%, respectively, on average.