Visa And MasterCard: What Is The Difference Between Them And Which One To Choose?

International payment systems Visa and MasterCard are among the most widespread in the world and are popular among many bank card holders. In some countries, there are no significant differences between the two, but there are regions where cardholders should definitely be aware of the differences between Visa and MasterCard. In this article, you will learn about them. We also recommend that you get acquainted with https://rates.fm/, which provides tools for tracking currency exchange rates in Ukrainian financial institutions, which will allow you to improve your online payment experience.

What Are Visa And MasterCard?

These are two large international payment systems that perform the functions of network processors when making payments. They do not issue cards, and do not set interest rates or commissions (this is done by partner financial institutions).

The main function of payment systems is to establish interaction between payment participants. Every transaction involves two parties:

• issuer – a financial company that issues a payment card and provides it to the holder (for example, a user who has entered into an agreement to open a bank account);

• acquirer – a financial company that processes a non-cash transaction. For example, this is payment for a purchase through a POS terminal. The company that installed and maintained the terminal is an acquirer.

The task of the international payment system is to establish clear rules for interaction between the issuer and the acquirer, as well as to check transactions for compliance with these standards. In this sense, Visa and Mastercard are no different.

Interestingly, Visa appeared in 1958 – only 12 years after the release of the world’s first bank card. The company, created by Bank of America, offered a paper card with a $300 limit. The main competitor appeared in 1966 – it was Master Charge, created by a group of American bankers. In 1979 it was renamed MasterCard.

Both companies are systematically developing, and adapting to the technological advances of each decade: from the first ATMs to contactless payments and online payments including with Bitcoin or Binance Coin from Binance crypto exchange. So, you can make utility payments, purchase clothes, a car, an insurance policy from Aetna or other important services.

Differences Between Visa And MasterCard

The main characteristics of a bank card (commissions, interest rates, points, bonuses) are determined by the issuer. Therefore, potential cardholders should pay attention to these subtleties rather than the logo printed on the card.

Visa and MasterCard are primarily involved in payment processing and control. Each company ensures that the buyer’s money reaches the seller safely and quickly. In this regard, the benefits for holders are the same.

Another plus is equivalence. Typically, if a merchant in any part of the world accepts Visa, they will also process MasterCard payments (and vice versa). However, payment services may vary by country and issuer.

MasterCard and Visa: how similar systems are:

1. Types of cards. Both companies offer the same categories of bank plastic cards: standard, electronic, and premium.

2. Precautionary measures. Payment systems, in particular, support of 3D Secure technology.

3. Maintenance cost. This may be a fixed value for both systems’ cards.

4. Global coverage. Payment systems support most countries in the world.

Visa and MasterCard – the difference:

1. Visa leads in market coverage, while MasterCard is in second place;

2. at the same time, MasterCard is used in more countries around the world (approximately 210 versus 200);

3. There are different types of codes for Internet transactions: CVV2 (Visa) and CVC2 (MasterCard);

4. Visa conducts the vast majority of transactions in US dollars, and MasterCard – in euros. This matters when shopping abroad.

Visa And MasterCard: Security of Your Transactions

Payment systems are introducing their own security methods. In particular, Visa uses Advanced Authorization (this involves the use of artificial intelligence and machine learning to personalized recognition of unusual transactions). In milliseconds, the system determines the type of payment, analyzes the cost history, amount, and time of payment sets a risk score, and sends it to the card issuer. The banking institution’s system decides whether to approve or block such a transaction.

MasterCard has a similar system – Identity Check (it is based on EMV 3-D Secure technology). It helps merchants and banks assess risks and conduct secure transactions. The check here is even deeper: the system even takes into account characteristic user gestures, screen brightness, statistics data, etc. If there is any suspicion, Identity Check offers additional verification tools: one-time password or biometric data entry.

In What Cases Is It Better to Use a Visa Card?

Basic-level Visa cards do not offer users anything extraordinary. The main advantages of the payment system are implemented in Visa Signature and Infinite cards. Among them:

• Purchase protection and insurance: compensation for lost luggage, compensation for delayed or overloaded luggage, extended warranty;

• Visa Signature Luxury Hotel Collection: special guest status at almost 1,000 hotels. This is an automatic room upgrade, free Wi-Fi, breakfast for two at the expense of the establishment, etc.;

• Travel benefits: Priority Pass lounge, Global Entry credits, preferred car rental;

• Access to emergency assistance: fast cash withdrawal, urgent card replacement, etc.

You should choose Visa if you travel frequently and want to take advantage of the benefits available to holders of privileged bank cards.

When Is It Best to Choose MasterCard?

Each level of MasterCard bank cards has its own features. A standard card (as in the case of Visa) does not offer anything special, except for typical features. Other categories (World and World Elite) provide the following opportunities:

• Purchase protection and insurance: detection of fraudulent activity and help in solving the problem, mobile phone protection, as well as Global Emergency Services (anywhere in any language);

• Concierge services for booking tickets for events, tables in restaurants, and assistance in the delivery of large-sized purchases;

• Access to special offers in more than 3,000 hotels around the world;

• Unique access to luxury events: golf tours, film festivals, private lessons, and the like.

MasterCard is suitable if you often travel around Europe and want to receive more services and bonuses, as well as if you are interested in premium service.

Conclusion

The difference between Visa and Mastercard cards becomes noticeable when making purchases in different countries of the world (online and offline, as well as when traveling and staying in hotels). Visa is more profitable for making dollar transactions, and MasterCard is more profitable for payments in euros. For a more pleasant online shopping experience, we also recommend using the Rates service, which allows you to track currency exchange rates at Ukrainian financial institutions. It is available to users from different parts of the world, including the financial centers of New York and Brussels.