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In a sign of just how important young tech companies in mobile payments and electronic commerce have become to established payments players, American Express Co. on Tuesday announced that it will invest $100 million in early-stage companies working in what AmEx calls the “digital-commerce” space.

AmEx announced no specific companies in which it will invest over a multiyear period, but its shopping list covers all of the hot areas of tech development in payments, “including loyalty and rewards, mobile and online payment management, fee-based services, security and fraud detection, and data analysis,” says an AmEx release.

All of AmEx’s major competitors in conventional payments as well as online payments providers also are on the hunt for attractive startups or slightly more established firms that might be developing the next big thing in mobile payments, electronically delivered rewards, or fraud control. Visa Inc., for instance, this year invested in the hot mobile-payments provider Square Inc. PayPal Inc. and parent company eBay Inc. have made a string of acquisitions to bolster PayPal’s position as the No. 1 provider of alternative payments, especially as the mobile niche prepares for expected mainstream acceptance. Their recent acquisitions include Zong, Magento, FigCard and RedLaser.

“I would think of it like the 1996 Internet, that’s where we are,” says mobile-payments consultant Todd Ablowitz, president of Centennial, Colo.-based Double Diamond Group LLC. “It looks like AmEx wants to place small bets in lots of places.”

Digital Transactions, November 8, 2011