Types of Credit Cards

The Four Major Credit Card Types

If you were to pull a credit card from your wallet right now, regardless of rewards type or card issuer, it is almost guaranteed to have the logo of one of the four the major credit card processing networks: Visa, Mastercard, Discover, or American Express. These iconic logos adorn thousands of credit cards worldwide and serve as indicators of a cards’ payment network (also known as the processing network). So what exactly is a credit card payment network? These networks are intermediaries responsible for facilitating all aspects of an electronic transaction. With every single swipe of a credit or debit card, these payment networks connect merchants, banks, card issuers to ensure that all money is moved to the appropriate areas. This includes verifying that your credit card is valid and eligible for use, notifying contacting the merchant’s bank and depositing the money from the transaction, and finally, reporting the purchase to your card issuer so that they can add the charge to your credit card’s balance.

Payment Networks vs. Credit Card Issuers

Payment networks and credit card issuers work hand in hand – but they are not the same thing. The most notable distinction between the two is that the card issuers are the ones that interact directly with the consumer and handle all things related to the distribution and management of your credit card. This includes the approval or denial of your credit card application, sending notices of payments owed, or providing assistance when you report a fraudulent transaction. Credit card issuers are also responsible for the setup of your credit card including rates and fees, introductory offers, or any forms of rewards. Payment networks, on the other hand, work unseen on the backend to ensure that every participant in the transaction is appropriately charged or credited from each transaction. Although the name of a credit card payment network may appear in the name of your credit card, a shopper will never have direct contact with the payment network.

Which Credit Card Payment Network Is the Best?

There are dozens of payment networks around the world, but Visa, Mastercard, American Express, Discover are by far the largest. As such, one of the only applicable means of choosing one card type over another is the difference in numbers of the merchants that accept these payment networks. While all four are accepted globally, the extent of which they are accepted both domestically and abroad varies between payment networks and could be significant to those that frequently travel overseas. Visa and Mastercard are the two largest networks of the major four and are accepted virtually everywhere both within the United States and internationally. Mastercard and American Express, on the other hand, are comparatively much more limited in their international reach and aren’t accepted in certain countries. Mastercard has partnered with credit unions of various countries which have helped to bridge the gap, but their international coverage is still not as comprehensive as the two larger networks. Smaller still is American Express, which has the most limited number of international merchants in both the U.S. and abroad.

Browse Credit Cards by Payment Network

Since credit card issuers (and not the payment networks) are responsible for arranging all the neat perks that come with your credit card, it makes very little difference which payment network your credit card uses. Find and compare the best credit cards from Visa, Mastercard, Discover, and American Express.