What is the Difference between Visa and Mastercard?

Updated on: 08 Jun 2023 // 3 min read // Credit Cards
Author :(545 posts)

VISA and Mastercard dominate the electronic payments industry presently. They are responsible for handling the world’s majority of card payments. VISA and Mastercard provide different offerings because neither of them is involved with extending credit or cards. 

All VISA and Mastercard payment cards are issued through co-branded relationships. These companies partner to offer a wide array of products including credit, debit, and prepaid card options. These two companies have a unique edge, but they operate differently.

If you use a Credit Card or debit card, you will notice the logo for either VISA or Mastercard in the corner of your card. For you as a user, there is no real discernible difference between these two signs. Both are simply forms of payment, accepted by the overwhelming majority of merchants in over 200 countries around the world. 

The issuing financial institution determines and sets the card’s terms and conditions, including fees, offers, rewards, and other features. Card issuers can also offer other benefits, such as identity theft and fraud protection, insurance, and business purchase discounts.

While differences in credit limits, interest rates, rewards programs, and other features are controlled by the card issuing company, VISA and Mastercard compete for the co-branded relationship and involvement in the drafting of card terms.

Mastercard and VISA, have the freedom to structure their fees and this structuring and reporting is one of the main differences between the two network processors.

What is a VISA Card?

A VISA card is the largest payment network processor in the world. It is a cashless facility, which can be used to make payments for goods and services. It uses the VISA network to process payments and offers a wide range of cards like debit, credit, prepaid and gift cards. 

The VISA card has a 16-digit account number, along with a magnetic stripe and a microchip. Various financial institutions partner with VISA to use its payment network and gateway. Moreover, each card issuer has its own terms and conditions that one must abide by in regard to applying for a VISA card. 

What is a Mastercard?

Mastercard is reckoned as the second largest payment network processor in the world. It generates revenue mainly from gross dollar volume fees, which is a processing fee they charge from the businesses that accept payments through their cards. This also consists of payments made from Cirrus and Maestro. 

Mastercard only collaborates with financial institutions that work exclusively on the Mastercard network. It operates in over 210 countries and territories. Mastercard works with more than 150 currencies. 

Benefits of a VISA Card

The VISA card provides three tiers of benefits, including Traditional, Signature, and Infinite. Credit cards will read ‘VISA Signature’ or ‘VISA Infinite’, in case they are a part of those tiers. 

Some common benefits for all the tiers include:

  • Zero fraud liability 
  • Lost/ stolen card reporting
  • Waivers for collision damage for auto rentals
  • Extended warranty on certain purchased items
  • Travel/ emergency assistance
  • Travel protection
  • Return & purchase protection

Cardholders can call the number mentioned behind their card for above-mentioned facilities. A representative will guide you through the benefits based on your card’s tier and the additional benefits provided by the card issuer. 

Benefits of Mastercard

Mastercard also offers three tiers of benefits, i.e. Standard, World, and World Elite. 

The benefits of Mastercard include:

  • Zero fraud liability
  • MasterCard global service hotline
  • Identity theft protection 
  • MasterCard travel & lifestyle services
  • Concierge services 
  • Free memberships to certain services depending on the location

Key differences between Mastercard and VISA Card

The major distinction between VISA and Mastercard is that the user’s card will only work on the payment network wherein the particular company operates. A VISA card will not work on Mastercard’s network and vice-versa.

MastercardVISA Card
The service fee is based on the percentage of the global dollar volume.The service fee is based on the issuer’s card volume.
It uses PayPass for contactless payments.It uses payWave for contactless payments.
The transaction, circulation of cards & purchase volume is less in comparison to VISA Cards.Transactions, purchase volume, & card circulation is higher in comparison to Mastercard.

These were the features, benefits and key differences between a VISA Card and Mastercard.