đ
Visa vs Mastercard - How Do They Compare? (Credit Card Comparison) - YouTube
Channel: The Infographics Show
[0]
According to data released April 26, 2018,
by the American Banking Association, there
[5]
were 364 million open credit card accounts
in the United States as of the end of 2017.
[12]
And credit cards are found in most Americans'
wallets with multiple studies showing that
[16]
about 7 in 10 Americans have at least one
credit card.
[20]
With so many cards on the market, which one
is the right one to choose?
[23]
We wonât be looking at every card out there
today but we will be comparing two of the
[28]
major players.
[29]
The two that weâve all heard of and most
of us have used or will use at some point.
[34]
Welcome to this episode of The Infographics
Show: Visa vs. MasterCard.
[38]
Visaâs history dates back to 1958 when Bank
of America launched the BankAmericard.
[45]
This was the first mass-marketed credit card
program and it quickly grew in popularity.
[49]
By the 1970s, BankAmericard was an independent
entity and it was renamed Visa.
[54]
Visa then launched VisaNet, which was the
first electronic payment authorization, clearing,
[60]
and settlement system in the world.
[62]
Visa has a market capitalization of $195 billion,
there are 11,300 people working for the company
[70]
and there are $6.5 trillion in transactions
made on Visa cards around the world each year.
[77]
What about MasterCard?
[79]
MasterCard was originally known as Interbank/Master
Charge and it was created by several California
[84]
banks as a competitor to the BankAmericard
â which as we just mentioned was what Visa
[89]
used to be called before it was called Visa.
[91]
From 1966 to 1979, MasterCard was called Interbank
and Master Charge.
[97]
The MasterCard brand officially came into
effect in 1979.
[101]
It continued to grow as a major credit card
brand and listed as a public company through
[106]
the New York Stock Exchange in 2006.
[109]
MasterCard has a market capitalization of
$110 billion, there are 10,000 MasterCard
[115]
employees and there are $3.6 trillion transactions
made on MasterCards around the world each
[122]
year.
[123]
So the numbers tell us that Visa is the bigger
company, but today both Visa and MasterCard
[128]
are widely accepted in over two hundred countries
and it is very rare to find a location that
[133]
will accept one but not the other.
[135]
However, neither Visa nor MasterCard issue
any credit cards themselves.
[139]
They simply provide the payment service and
mechanism and then rely on the banks to issue
[144]
credit cards.
[145]
So when it comes to comparing specific card
benefits such as monthly fees and interest
[150]
rates, you need to look at the bank or financial
institutions that issue as well as assessing
[155]
Visa or MasterCard themselves.
[157]
So which is better, Visa or MasterCard?
[160]
Before we get in to a head to head comparison,
letâs first look at whatâs important to
[164]
take in to account when choosing a credit
card.
[166]
Firstly you need to have a good think about
what you want to use the credit card for.
[171]
Maybe you want to buy things online, or on
holiday, or to pay your bills.
[175]
And how you intend to pay off what you owe
on your card also has a bearing on which card
[179]
is the best for you.
[180]
Do you intend to pay the full bill each month
or spread repayments over a period?
[185]
Then you need to look at what the card has
to offer that will best match your purchasing
[189]
and repayment profile.
[190]
Both Visa and MasterCard offer a number of
features and service offerings.
[194]
Letâs take a look at some of these.
[196]
Premium cards â Both Visa and MasterCard
provide a range of standard and premium card
[202]
options.
[203]
Features vary depending on the credit card
provider but could include things such as
[206]
concierge services, global customer assistance,
complimentary insurance and special offers
[211]
at a range of stores, hotels and restaurants.
[214]
Contactless payments â This is functionality
that allows you to make payments by simply
[219]
tapping your card against a compatible reader.
[221]
âTap and Tagâ as itâs more commonly
know.
[224]
Exclusive offers - Visa has their Entertainment
Program and MasterCard the Priceless Program.
[229]
Both provide offers with entertainment, dining,
travel and shopping.
[233]
And the options vary depending on whether
you are a premium or standard cardholder.
[237]
Global security services â Both card companies
have global service support hotlines to provide
[242]
assistance if a card is lost or stolen, and
these services are available 24/7 from anywhere
[248]
in the world.
[249]
Online shopping protection â Security is
an important area for Visa and MasterCard
[253]
and they have their own security processes
when shopping online.
[257]
There is Verified by Visa and MasterCard SecureCode.
[260]
When using these services you will be prompted
to enter a password or unique SMS code when
[265]
you make purchase at an online store.
[268]
So with these cards being so similar, how
do you choose between them?
[271]
From what we learnt online, itâs best to
look at specific details for the card youâre
[275]
considering.
[276]
Hereâs are some of the features and benefits
worth considering:
[278]
6.
[279]
Annual fees â Most credit cards charge an
annual fee and itâs something worth exploring
[284]
when youâre deciding which card is best
for you.
[286]
The fee can be as low as $25 for a basic card,
or as high as $700 for a premium option card,
[293]
which comes with all the premium benefits.
[295]
The credit card issuer determines the actual
annual fee depending on the features available.
[300]
Visa Platinum, Signature and Infinite cards,
as well as World MasterCardâs, usually have
[305]
higher fees because of the premium features
and services they provide.
[309]
5.
[310]
Interest rates - Standard credit card interest
rates can have a major impact on the cost
[314]
of the card you choose, so itâs important
to look at both the purchase rate and the
[318]
cash advance rate for each card you compare.
[321]
You also need to decide how you intend to
pay your card off.
[324]
Will you pay it timely each month, or let
the balance roll over?
[327]
Your spending and repayment habits make understanding
the interest rates very important.
[332]
4.
[333]
Rewards â if you are a big spender then
rewards programs can be attractive and there
[337]
are a wide range of Visa and MasterCard rewards
and frequent flyer programs.
[342]
These products offer you points per $1 spent
and when comparing the programs itâs worth
[346]
considering the earn rate, the type of rewards
available and the average amount you will
[351]
spend on your card, so that you can decide
if the annual fee will be worth it as the
[355]
fee will often be adjusted to how attractive
the reward program is.
[360]
3.
[361]
Interest-free days â We already talked about
understanding your repayment habits, and one
[365]
of the main reasons this is important is because
cards will have different interest free periods.
[370]
Both companies will usually offer some sort
of interest free period, so if you pay your
[374]
bill within that time, you can save big.
[377]
2.
[378]
Introductory offers - Credit card providers
regularly offer new customers additional perks
[383]
to encourage you to bin your current card
and swap providers.
[386]
Offers such as bonus points, 0% balance transfer
interest rates or 0% purchase rates.
[392]
But these features are generally available
for an introductory period so may only add
[397]
short-term value to the card you choose.
[399]
So make sure you assess all the benefits before
making a decision.
[403]
1.
[404]
Security services â Weâve mentioned security
with online shopping, but in addition to these
[408]
security services some of the credit card
providers also offer 24/7 fraud-monitoring
[414]
services, daily transaction limits or even
the ability to temporarily lock your card
[419]
if you have misplaced it.
[420]
And in the US all credit cards are now chip-and-PIN
products, which offer superior security for
[425]
in-person payments when compared to the older
style cards that just have a magnetic strip.
[430]
While Visa and Mastercard are different on
a corporate level, the variations are relatively
[435]
minor when it comes to using a credit card
from either of these companies.
[438]
If youâre in the market for a new credit
card or maybe your first credit card, the
[442]
important thing to do is focus on the features
that best suit your needs such as interest
[447]
rates, annual fees and awards programs.
[449]
Which do you prefer?
[450]
And do you know other differences between
these two financial giants that we didnât
[455]
mention?
[456]
Let us know in the comments.
[457]
Also be sure to check out our other video,
What a Dollar ($1) Gets You Around the World.
[461]
Thanks for watching, and as always, please
donât forget to like, share and subscribe.
[465]
See you next time!
Most Recent Videos:
You can go back to the homepage right here: Homepage