What is a MasterCard?
MasterCard, Incorporated or MasterCard Worldwide is an American multinational financial services corporation with headquarters at the MasterCard International Global Headquarters in New York, USA. The principal business of MasterCard is to process payments between banks of merchants and card-issuing banks or credit unions of purchasers who use the "MasterCard" brand of debit and credit cards to make purchases. MasterCard Worldwide has been a publicly-traded company since 2006. The company was created by two entrepreneurs in Louisville, Kentucky, named Raymond Tanenhaus and Stanley Benovitz. It was absorbed by the United California Bank in 1966. Prior to its initial public offering, MasterCard Worldwide was a cooperative owned by the 25,000+ financial institutions that issue its card.
What are Programs and Services of MasterCard in Canada?
MasterCard in Canada manages a full range of payment programs and services including credit cards, online debit cards and ATM cash access. Being a leader in the industry, MasterCard Canada continues to develop strategic marketing programs to build awareness for the brand and increase business for financial institutions which issue MasterCard. It maintains standards and procedures for the acceptance of member transactions worldwide; provides global communication network for the electronic transfer of information and funds among issuing companies; and, support marketing and operations of member-organizations in connection with MasterCard programs and services. It has made the commitment to continuously improve its products and services for the benefits of cardholders
What are the Common Denominators of MasterCard and Visa Card?
Master card and Visa Card are the leading payment processors in Canada. These financial companies do not issue credit cards at all. Credit cards are issued by banks and other financial institutions. MasterCard and Visa simply provide the payment networks that allow the transactions to go through. Credit card issuers decide on the interest rates to charge, rewards to offer, and other terms and conditions associated with credit cards.
MasterCard and Visa make money by charging merchants for their services. Merchants pay charges to payment processors to access the networks that allow credit and debit card purchases to go through and connect businesses with customers' banks. On top of regular monthly costs associated with accessing the payment networks, Visa and MasterCard also charge interchange fees based on the transactions that take place.
This means that these payment processors make money on transactions. This is the process even if the customer does not make credit card payments or the merchant loses money due to a chargeback. MasterCard and Visa may see revenue reduced when fewer interchange fees are paid but they are not at risk from credit card defaults. These payment processors do not actually issue the cards bearing their logos. Visa and MasterCard are not even concerned about who carries their cards since they do not involve themselves in credit card applications and approvals.
What are the Differences between Visa and MasterCard?
Both companies operate in much the same way. From a consumer point of view, there is not much of a difference between MasterCard and Visa. There are very few retailers around the world that will accept one type of card and not the other. The other major payment processing systems are Discover and American Express, and these two do not have the same reach as MasterCard and Visa. However, Discover and American Express actually issue their own cards as well as provide payment processing services.
The main difference between MasterCard and Visa is the amount of money the companies make. Visa makes more than MasterCard, enjoying greater revenue and having a larger number of assets than its rival. Visa also employs more people. The main thing is to actually understand that these companies are not credit issuers. They simply facilitate payments. Understanding this can help you understand the financial world and make more informed credit decisions.
Understanding MasterCard and its Main Competitor
This article has just explained salient points about MasterCard and Visa card. You now know that both are payment processors. The information is of value since almost all consumers use these credit cards and payment processors.