Discover is giving away cash and gift cards every day this year, leading up to a $1 million grand prize as part of ts new sweepstakes program to encourage card usage. With every purchase using a Discover card, a card member will be automatically entered into the program with a chance to win $500, $100 or a gift card valued between $25 and $500. On Jan. 10, 2011, one winner will be chosen for the $1 million prize.

There was a little less gloom among small business owners in December, with fewer seeing the economy getting worse and more forecasting improvements in their own businesses in the coming year, according to Discover Financial Services’ latest index. “Small business owners are entering 2010 on a cautious note,” said Ryan Scully, director of Discover’s business credit card. “They’re still looking for more encouraging signs in the overall economy, but on a positive note, the number of them who see conditions for their own businesses getting better in the next six months increased for the first time since August.”

Discover Financial Services, issuer of the Discover cards, today reported a 16 percent drop in profit for its fourth quarter, with climbing credit card defaults playing a part in its bottom line. Discover – the sixth-largest credit card issuer – reported net income of $371, or 63 cents a share, for its fourth quarter ended Nov. 30, down 16 percent from $444 million, or 89 cents a share, in the same period last year.

The Internet, blogs and social media have taken hold of society, but apparently small businesses still haven’t embraced going online, with 55 percent not having a website and about the same percentage claiming it’s a myth that they need to have one, says a new survey by Discover Business Card. In another finding, 46 percent of small business owners said it is a myth that every company should have a website, while 44 percent felt the opposite and 10 percent were not sure.

Analysts at Bank of America/Merrill Lynch today upgraded three credit card companies – American Express (AXP), Capital One (COF) and Discover (DFS) – to neutral from underperform, bolstored in part by the better-than-expected jobs report on Friday.

Plagued by cash flow issues and a gloomier economic outlook, Discover Business Card’s index of how small businesses are faring fell 12 points in November, its lowest level in nine months. The Small Business Watch index dropped to 76.5, from 88.5 in October. The November 2008 index of 67.5 is the lowest point recorded for the Watch.

Amercan Express and Discover Card take top spots in a J.D. Powers Survey that shows the growing popularity of reward programs. The study measured customer satisfaction with credit cards in five key areas: interaction; billing and payment process; fees and rates; reward programs; and benefits and services.