Visa® vs. Mastercard®: What’s the difference?

Visa and Mastercard are the two biggest credit card networks in the U.S., according to the Consumer Financial Protection Bureau.  

Credit cards are issued through banks and financial institutions. But credit card networks are responsible for processing the transactions. Visa and Mastercard support debit cards, credit cards, prepaid cards and gift cards.

What you’ll learn:

• Visa and Mastercard are the most widely accepted credit card networks, but neither issues credit cards directly.

• Banks and financial institutions issue credit cards and partner with credit card networks.

• The benefits and services Visa and Mastercard offer differ. 

• Capital One issues credit cards from both Visa and Mastercard.

A Visa credit card is any credit card that processes payments through the Visa network. Businesses in more than 200 countries and territories accept Visa cards. 

Visa offers three tiers of credit cards: Traditional, Signature and Infinite. Each product offers different core benefits, to which issuers can add extra benefits. Examples of benefits include roadside assistance, trip cancellation insurance, cellphone protection and more.

You can learn more about what Capital One Visas offer by checking the benefits guides.

A Mastercard credit card is any credit card that processes payments through the Mastercard network. Businesses accept Mastercard in more than 200 countries and territories. 

Mastercard also offers several tiers of credit cards, including Standard, World and World Elite. Like Visa, each product comes with different core benefits. Issuers might add optional benefits like extended warranty and price protection.

You can learn more about what Capital One Mastercards offer by checking the benefits guides.

Credit card networks are generally similar in how they work. Both Visa and Mastercard:

• Are widely accepted: Most retailers accept Visa and Mastercard. But some merchants have an exclusive partnership with one specific network. 

• Work with financial partners: The decision whether to approve card applications is left to their issuing partner. The issuer also offers its own rewards and benefits, interest rates, fees and terms and conditions. 

• Use contactless payment technology: To make payment processing faster, both networks use contactless payment technology where the cardholder taps or holds their card, phone, watch or other device over the card terminal. 

• Support more than just credit cards: Both networks have partnerships beyond credit card issuers. They also support debit cards, health savings account cards and prepaid cards.

There are some areas where Visa and Mastercard differ. For example, Visa and Mastercard operate on separate payment networks that process purchases using different systems. Most businesses accept both.

Visa and Mastercard may offer their own benefits. But for the most part, the card issuer determines the major benefits, including rewards.

Both Visa and Mastercard have a long history of securely processing payments and are likely to be accepted by the majority of merchants that allow card payments.

Instead of focusing on the payment network, it may be better to choose a card based on what the individual benefits and rewards mean to you. You could compare things like cash back and travel rewards, annual percentage rate (APR), annual fees, introductory interest rates and your credit history to determine which credit card is right for you.

American Express and Discover® are two other major credit card payment networks. But unlike Visa and Mastercard, Discover and American Express are also credit card issuers. That means they issue the cards themselves as well as partnering with banks and other financial institutions to do it.

That won’t make much difference to the customer, especially if you’re not traveling abroad. It mainly affects how each card transaction is handled.

Visa and Mastercard are both widely accepted. The major differences among credit cards have to do with the card issuer and the specific benefits of each card.

Capital One partners with both Visa and Mastercard. If you’re ready to apply for a credit card, you can see whether you’re pre-approved without harming your credit scores.