What are Visa and Mastercard?
Visa and Mastercard are two of the four largest credit card networks globally, with the other two being American Express and Discover. Credit card networks make everything behind the scenes of a credit card payment possible by processing transactions between merchants and card issuers, such as banks and credit unions.
While Visa and Mastercard don’t issue credit cards, they provide the infrastructure that makes credit card payments seamless. Things like your card’s credit limit, interest rates, annual fees and rewards programs are determined by your issuer, not Visa or Mastercard.
Visa vs. Mastercard benefits
While most credit card benefits come from the issuing bank, Visa and Mastercard also provide benefits tied to their respective networks. Many benefits are provided at the card issuer’s discretion, so even if your card is in a specific Visa or Mastercard tier, you might not have the same benefits as other cards at the same level.
Here are a few examples of Visa benefits and Mastercard benefits:
Visa benefits
Access to roadside dispatch: A 24/7 pay-per-use roadside assistance service that can arrange towing, locksmiths or jumpstarts for you.
Travel and emergency assistance services: Can help with emergencies while traveling, including medical referrals, prescription replacements and translation services.
Return protection: Visa will reimburse you for eligible items worth up to $300 if a merchant refuses to accept a return.
Mastercard benefits
Mastercard ID theft protection: This service can help monitor the internet for leaked personal info, alert you of suspicious activity and help you track your Equifax credit score.
Mastercard travel & lifestyle services: Enjoy luxury hotel perks, flight and car rental discounts and airport concierge services.
World Elite Concierge: A 24/7 concierge service that can help with tasks like restaurant reservations, event tickets and locating lost luggage.
How are Visa and Mastercard similar?
As the two largest credit card networks, Visa and Mastercard share many key features, making them nearly interchangeable for most consumers:
Global acceptance: Visa cards are accepted in over 200 countries, while Mastercards are accepted in over 210 countries. You’ll rarely encounter a merchant that takes one card but not the other.
Zero liability protection: All Visa and Mastercards protect you from unauthorized charges, ensuring you’re not held responsible for unauthorized charges.
No direct issuance: Neither Visa nor Mastercard issues credit cards directly. Instead, they work with financial institutions to offer cards on their networks.
Varying card tiers: Both networks offer several card tiers with varying benefits to suit different needs.
How are Visa and Mastercard different?
The differences between Visa and Mastercard credit cards are relatively minor. Overall, Visa cards generally offer slightly stronger travel-related benefits and protections, while Mastercards may unlock access to more discounts and exclusive experiences.
Visa has three primary card tiers:
Visa Traditional: Includes basic benefits like roadside assistance, emergency cash disbursement and emergency card replacement.
Visa Signature: Expands access to a wider range of benefits and protections, including extended warranty protection, trip delay protection and Global Entry statement credits.
Visa Infinite: Offers the highest levels of protection and premium perks like airport lounge access and airline incidentals statement credit.
Mastercard credit cards also come in three tiers:
Standard Mastercard: Access to limited benefits like zero fraud liability and ID theft protection.
World Mastercard: Adds cell phone protection and special discounts with partner brands like Booking.com, ResortPass and Lyft.
World Elite Mastercard: Features premium benefits like access to the World Elite concierge and a higher level of cell phone protection.
Ultimately, the biggest differences depend more on the issuing bank than the network. The card issuers determine factors like your interest rate and credit limit and which credit card network benefits they will support.
Should I get a Visa or a Mastercard?
The differences between Visa and Mastercard are pretty slim. Instead of focusing on the network, pay attention to the issuing bank, the card’s perks and how they align with your spending habits. Here are some standout options from both networks:
Visa Cards
When it comes to options for Visa cards, the Chase Freedom Unlimited® stands out for offering generous rewards rates on common everyday spending categories and no annual fee.
The Wells Fargo Active Cash® Card is another Visa card worth considering if you don’t want to deal with tracking bonus categories and prefer earning a flat reward rate across purchases. Best suited for credit scores of 670 or higher, the card also offers a valuable welcome bonus and introductory APR offer.
Mastercards
On the Mastercard side, the Citi Double Cash® Card is a great cash-back card earning an unlimited 2% on all purchases (1% back when you buy and 1% back when you pay). The card also has a $0 annual fee, which can help keep additional costs down.
Consider the Capital One Platinum Credit Card if you’re building or rebuilding your credit. While the card doesn’t offer any rewards program, it has no annual or foreign transaction fees, and, after just six months, Capital One will review your account will automatically be reviewed for a higher credit line or an upgrade to a rewards card.
source: cnbc.com
