Visa vs Mastercard: Here’s The REAL Difference…

July 30, 2019 posted by


– So the other day I was
out with a friend of mine, and a lot of my friends will often ask me questions about money and finance, just because that’s what I
study day in and day out. And I had somebody ask me a question that absolutely stumped me, and so I decided to find
the answer to this question and put together a YouTube video. But that question was, what is the difference between
a Visa card and a MasterCard? And it’s literally a question I have never been asked before and something I’ve
literally never thought of. But as soon as someone
asked me that question, I opened up my wallet and I noticed that my bank has a MasterCard, (bell dings)
and I have friends of mine whose banks have Visa cards,
and they were wondering if one is better than the other. So that’s what we’re gonna be
talking about in this video, what the heck is the difference between a Visa card and a MasterCard, and is one better than the other? (screen whooshes)
So the first thing we have to understand here is that there’s two different groups or entities at play here. Number one, we have the
credit card companies, which is Visa, MasterCard, and then you could also
add American Express and Discover to that list. And then number two, you have the banks, like Wells Fargo or Bank of America. Now these credit card companies like Visa and MasterCard are not the ones that are actually issuing branded cards. There’s no such thing as a
Visa bank or a MasterCard bank. You’re gonna find that the Bank of America or Key Bank has a Visa or a MasterCard. And the reason behind that is
because Visa and MasterCard are what we call these
credit card companies or more specifically,
payment technology companies. (screen whooshes)
And so essentially what it is, it’s a processing network
where Visa and MasterCard are basically handling the transactions between the bank and the merchant. This is not something that the banks themselves are handling. They are going through the payment network of either Visa or MasterCard or also Discover or American Express or some of these larger
credit card companies. And what’s interesting here is how these companies actually make money, because we know how banks make money. Banks make money in one way by offering credit cards to people, and then they earn money from interest. So when you load up that credit card and you’re making those interest payments, that money is going to the bank. But believe it or not, none of that money is being passed along to
this credit card company, and Visa and MasterCard
are actually making money in a completely different way. (screen whooshes)
Visa and MasterCard are making money in
merchant or business fees. they’re actually making
money from the merchant. So every time you swipe your card at a store or a gas station,
Visa and MasterCard, or whoever the credit card company is, is making a very small amount of money, a percentage of that transaction, being paid by that business owner. So everything Visa and
MasterCard are doing is between the merchant and the bank. It really has very little to do with you, because you’re dealing
directly with the bank. So now that we understand
what Visa and MasterCard are, compared to a traditional bank, the big question that
you probably have is, is there a difference, and
is one better than the other? And the answer to that is,
there’s kind of a difference, but it’s not nearly a major difference to the point where you
would look at it and say I wanna have a Visa card or
I want to have a MasterCard. And the reason behind that is because banks are the ones that
set interest rates, they determine the fees, and they also determine
the perks and rewards. That has nothing to do with the credit card
companies Visa or MasterCard. So the majority of the
things that differentiate one credit card from another are based on the banks and
what the banks determine. So most people are not
going to be deciding on a credit card based on
the Visa or MasterCard label. It’s gonna be based on, do I want the Bank of America credit card or the Chase Bank credit
card, based on the cashback and the different perks
that bank is offering. (screen whooshes)
But I went ahead and did some digging and I found
this article on ValuePenguin that talks about MasterCard versus Visa. I’ll link it up in the description below. And this basically shows
that both Visa and MasterCard offer similar rental car insurance, so if you are ever renting a car, make sure you put that
on a Visa or a MasterCard for some kind of insurance
there on that vehicle. Both offer travel benefits in
the higher tiers of the card because they have different tiers like a signature or a platinum level, based on the credit card. And both offer purchase protection and extended warranty
in their higher tiers. So both Visa and MasterCard are offering basically the same exact
perks to the cardholder. The only time you’re really going to see a difference between MasterCard and Visa is with occasional seasonal deals or one-time purchases
with specific merchants. So maybe for example,
MasterCard wants to give you 5% off your Old Navy purchase for example, if they wanted to make a
deal with that merchant. That’s about the only time you’re going to see deals like that where one card might be
better than the other. (screen whooshes)
And one example of this that I actually saw myself, something I was able to take advantage of, is MasterCard holders will get a VIP tour of the One World Observatory
in New York City. So that’s the only time I’ve ever really gotten a perk for having a MasterCard. And so occasionally you
may find perks like that, where Visa card holders
or MasterCard holders will specifically get a perk that other card holders will not. (screen whooshes)
But anyways guys, that wraps up this video and
that answers the question of the difference between
Visa and MasterCard. There’s really not much of a difference and it has very little
to do with the consumer. This is mostly something that has to do with merchants and banks. You might find deals once in a while specific to Visa or MasterCard holders, but both of these cards are offering essentially the same exact thing, and it’s essentially
just the technology here, the payment technology that
Visa and MasterCard handles. All of the cool stuff,
the cashback, the rewards, (graphics bubbling)
that is handled by the bank, and so if you are one of those people that focuses a lot on credit
card deals and rewards, that is mostly what you’re looking at. You’re not really caring
about whether or not it is a Visa card or a MasterCard. But thanks so much for
watching this video. I hope you guys enjoyed it. If you did, make sure you
drop a like and subscribe, and I will see you in the next one.

77 Comments

77 Replies to “Visa vs Mastercard: Here’s The REAL Difference…”

  1. Zachary Laid Finding Freedom says:

    Waiting for bitcoin card

  2. Stock Market Pirate Videos says:

    Clicked straight away. Always good to get some important info about these two beasts.

  3. Damulllutkid says:

    Imagine having a master card XD

  4. INVESTING WITH M says:

    HEY WHAT DO YOU THINK ABOUT INVESTING IN VISA OR MASTERCARD STOCKS ?? WHICH ONE DO YOU PREFER ?

  5. The Process of Getting Rich says:

    Thanks for putting this info out there!, I'm sure a lot of people are uneducated on this subject. You put out some of the best money information on here!

  6. 10X Academy - Wealth Creation System says:

    Great having both imo. Can never go wrong as long as you use the credit responsibly! 🙌👍💯

  7. Dallas Dan Digital Productions says:

    Thanks for that Ryan. ive had a visa for years, and no one ever explained it like that.

  8. TheRjmayer says:

    One has a Visa logo and the other has a Mastercard logo

  9. Tenken 73 says:

    So great vid, forgot about locations where cards are accepted. Very relevant for international travel

  10. Rhiannon Lopez says:

    Good job

  11. Wealthbuilderz TV says:

    so basicilly they have a monopoly on this industry. Discover is trying to get involved but it seems like its hard.

  12. Mysteryqueen86 says:

    very good vlog today Ryan

  13. Rational_Thinker_86 says:

    Just to note that we cannot say Visa or MC as credit card companies. They are not even payment tech companies. They are payment gateway companies. It’s amazing how they inserted themselves in to the whole payment scenario. Technically, there was no need for them to be in play. A really big bank like Bank of America could supply the merchant with POS device and then they could also issue credit cards and play the role of Issuers. Due to all the smaller credit unions and small banks which couldn’t scale up and be acquirers or issuers, payment gateway companies like Visa MC and payment processors like Fidelity, Vantiv etc came in to picture.

    Also, AMEX has the best rental car insurance benefits for customers. They can play as secondary insurance at no fees or as primary if you activate the per rental $19.99 fee. This would ensure that a costly per day rental insurance of $35 is avoided. This primary protection is valid for 45 days and is only valid per rental. No need to to have a primary car insurance for folks who don’t have cars or who live in big cities like New York, SFO etc.

  14. swadyz says:

    How about stating the only really important difference – that one uses dollar as basis for calculations and the other one euro lol…..?

  15. Ryan Scribner says:

    If you thought this was useful or interesting, please share it with a friend! 👍

  16. Stock Market Investing says:

    Both are amazing companies! Cards in circulation-growing, total # of transactions processed-growing, total payment volume-growing. The only thing I worry about is threats to the business model because it's the best business model on Earth. Free cash flow monsters!

  17. DAVID Y says:

    I use Visa or MasterCard depending on the rewards being offered 💰💰💰💰💰

  18. dannyrod980 says:

    MC will never take me on I apply 3 times. Yet, I have 2 Visa & 1 AMEX card with high credit score. What gives MC

  19. Nicholas Peitsch says:

    Great video! Always interesting to learn about these companies. You should consider Visa as a company to invest in, as it is an excellent (and safe) company which should rise from the increasing e-commerce dominance 😉

  20. Financial Prosperity says:

    Visa and MasterCard stocks have done extremely well in the past 5 years. Massively outperformed the market

  21. Methamphetameme says:

    When I was with my ex girlfriend one day we were talking about money and I was trying to stop her from spending money she didn't need to and I asked her how much money she has and she answered; "$1,200"… and my response was "How do you have that much after spending most of your pay cheque already?" and her response was "Well I have $200 in my bank and $1,000 on my credit card"… to which I shook my head and said "No… no… no… that's not how that works… sigh… internal frustration at lack of financial knowledge ".

  22. vodkaplusgin says:

    some businesses/merchants offer a lower cash option to avoid credit card fees to try to make you not use a card just a fyi 🙂

  23. Lissa Coax says:

    Having both may be a plus because u should consider that all merchants do not except a master card (credit) for example, Costco is one of those merchants. They have a contract with visa & because of it a visa credit card is the only form of credit they will accept.

  24. Wise Investor says:

    I have Both cards, and also Visa stock. You never can go wrong with both stocks… they outperformed the market easily… 2 Beast

  25. TruFinancials says:

    This is a great in-depth video about the difference between the two major card processors.

  26. Burnt Taco says:

    Costco doesn’t take MasterCard credit at the food courts

  27. L DM says:

    I always wanted to know that.

  28. Brandon Beavis Investing says:

    Good overview Ryan. Interesting video topic! 🙂

  29. Richard Forester says:

    I agree that in general there's little difference between Visa and MasterCard. Some exceptions might be where each is accepted. The real difference is in the tiers and the issuing bank. For instance, the perks on my Chase Sapphire Reserve Visa Infinite card are vastly better than a Visa Signature card. And I found out recently that MasterCard World Elite cards will get new perks including cell phone insurance soon.

  30. TheLondonVoyager says:

    If you travel a lot it's good to have both. I backpacked Peru and 95% of places were Visa 💳 only

  31. Stinky Lebinowitz says:

    I've wondered this for years. Early on I think MC and Visa had different acceptance rates, but think if that were true, it's long gone now.

  32. Mike F says:

    Payment processing is the ultimate Illuminati business. Skims money from the top of all transactions, yet has no accountability to the end consumer.

  33. John Quill Taylor says:

    MasterCard Numbers begin with 5, Visa Card Numbers begin with 4, AMEX begins with 3, so the difference appears to be: One! (Note: I am a long-term investor in "V" : – ) – j q t –

  34. Jorel Boston says:

    I found that throughout my world travels….its VISA…MASTERCARD…THEN AMERICAN EXPRESS….trust me you dont want to bring your Amex to buy small $4 trinkets at a Belgian Souvenir shop or snything less that 200 when buying Parisian chocolates

  35. Julio C. Guevara says:

    I clicked right away thinking this was going to be a stock comparison video 😂🙈

  36. Brendan Ever says:

    Mastercard are scum lords that force Patreon to comply to their political agenda. So, there's that.

  37. How to get rich from stocks says:

    Both are excellent companies. I personally prefer MA.

  38. Arina says:

    Visa is for USA and $, Mastercard is for Europe and €.

  39. Ishfaaq Peerally - Popular Investor says:

    Visa was a sponsor of the FIFA World Cup last year and it was the only accepted card there. Apart from these perks, they are mostly the same so it is better to have both. But the best credit card network in my opinion is American Express. It is both an issuer and a card network but not accepted everywhere.

  40. lonestarr says:

    Its more of a toll road. Each card company owns one. Each toll road connects consumer to merchant and bank to bank. Instead of cars traveling on their roads, its currency. Much like a toll road, the owner of the road (card network) charges a fee to use their system. The merchant puts that fee in their prices so it is the customer who pays for the convience of lightning fast and hassle free payments.

  41. ageofbogyo says:

    So not answering the question… What percentage of the transaction visa or mastercard takes from the merchant?? Maybe I am a merchant or my friend where I shop is and I want to support him by paying with the lower fee card. Such low fees can go high in car/travel/furniture and such industries.

  42. Clau ny says:

    Hi Ryan, I want to start my FBA business, do I need to open an LLC? or Should I do it
    under my name? What about the income taxes?I live in Manhattan. Where do I go to open an LLC? I
    know these are probably very basic questions but I don't know.

  43. Patrick Cogen says:

    🔥Great explanation Ryan. You are always sharing value for improving my life and channel as well, thanks!🔥

  44. Muchas Cosas says:

    It would be interesting to know more about the origins of these cards. I think Visa used to be the Bank of Americard (sp?) and Matercard used to be MasterCharge (not sure what bank(s) were the first to issue Mastercards.) Anyway, as others have said it's good to have both. Some merchants/venues only take one or the other and the perks can vary. Another thing are the perks with VISA Classic, VISA Signature, and Visa Infinite. Also the perks with Mastercard Gold, Platinum, World and World Elite.

  45. BJ McKay says:

    I despise both of these companies. Live within your means, people! Ryan I hope it is warming up where you are. Regards, BJ

  46. 299 999 views says:

    both are the best longterm stocks i own

  47. Villy P says:

    viral. calling it now

  48. Mungo Lewis says:

    There's the beginnings of a class action lawsuit in the UK regarding high merchant fees, which are passed on to the customer by the high price of goods and services. If the outcome is in favour of the consumer, anyone who's bought something in the last few years in the UK could be entitled to a windfall some of about £300.

  49. RB Vim says:

    I have all card companies for perk benefits lol 😂

  50. Antonio Kokic says:

    holly crap your channel exploded. I started watching some two years ago, you came a long way from poster-covered walls and a whiteboard.

  51. Manuel Encalada says:

    Short video, but full of useful info. Very nicely done.

  52. Zeke Tarasenko says:

    I like how he has a laptop right in front of him, yet needs to refer to his pad of paper for notes

  53. Jose Ramon Fernandez says:

    Cryptocurrency are better, you have, bank-network-money, all in the same decentralized system. Well, is is better to use it for trading and as storage of value, because it is difficult to find who accept it.

  54. M C says:

    I preferred MasterCard

  55. Giancarlo Albertini says:

    Visa and Mastercard are payment companies, im glad he clarified that a couple of minutes in but he called them credit card companies in the beginning which is not true. Additionally, visa and mc dont make money off the merchant at all, they make money off of the bank for processing their transaction and for connecting a merchant’s bank to the cardholder’s bank, ppl need to get more informed before they start making videos…

  56. EasyGameEh says:

    if you make a deposit into a certain service and then cash back out you only can do it to visa card. and with mastercard it is deposit only.

  57. Money Matters says:

    Basically none for the end consumer, just whatever bank/product you're using!

  58. Hunter Brown says:

    Haha I use Keybank to cash my paychecks then move that cash to my capital one 360 interest checking haha

  59. ARel REal TAlk says:

    Thank you I was always wondering that I was always prefer a visa over MasterCard but now you let me know that there is no difference the bank Bank of America is the one who controls what I get from either the visa or my MasterCard so thank you was really helpful I appreciate it

  60. SuperBizalz says:

    4:30 – So, there is no difference between Visa and MasterCard.

    A 6 minute video to tell us this? C’mon meow!!

  61. Value Venture Investing says:

    So basically, no difference.

  62. MrMovieflash says:

    That didnt really answer the question

  63. Demise Media says:

    Thank you for clarifying this for us Ryan! 💳 I bank with a local credit union. My debit is Mastercard & my credit card is Visa 👌🏼

  64. Jun Espiritu says:

    If you don't travel out of your own country, it does not matter what credit card you have. For the frequent traveler, it is wise to have all four (MasterCard, Visa, Discover and Amex). There are places/events that only accept one type of card because that particular event is sponsored by that card issuer.

  65. Rad Revenue Review says:

    Thanks Ryan. Good video. 😊

  66. REAL AMAZING WORLD says:

    MasterCard has a better network when in a foreign country. Sometimes the visa card network fails while the MasterCard network is successful in completing transactions

  67. Peter D says:

    You're forgetting to mention that worldwide, the Visa card is accepted in roughly twice as many businesses than MasterCard and that makes it the biggest difference of all between the two. I was very upset when my bank suddenly switched from Visa to MasterCard. that's when I started getting problems. I have nothing against either company but when I start getting issues where businesses don't accept MasterCard then that's a red flag for me. I'm changing bank for this.

  68. cmichael85 says:

    The exchange rates for VISA and Master are slightly different. You'd better check the rate before you shop overseas.

  69. George McGovern says:

    Visa was started by Bank of America in California. MasterCard was started BOA,s California bank competitors. That is the only difference.

  70. Bill McMinn says:

    For the consumer the difference between Visa abs MasterCard is there’s more MasterCards that are available with no annual fee. Only the Entry level Visa cards are no annual fee while only upper level MasterCards charge an annual fee.

  71. CLINTON JONES says:

    Good Job, Ryan
    …NOTE: The Smith's grocery store in my neighborhood announced last month that they will not be taking VISA anymore …the employees say that their 'FEES' are prohibitive and bordering on 'usury'

  72. Ken C says:

    There is no major difference between to the two for the consumer. The differences between the two will affect the merchant because as stated in the video, they are charged a fee per swipe. The main time there's a difference as a consumer is when traveling internationally.

  73. Tien Doan says:

    Invested in VISA in 2012 as my first stock. Loved the ROI, and probably will never sell

  74. Iquey says:

    MasterCard is a NasterCard. I just take one look at the logo and wanna puke lol. It feels so mid 90's to me.

  75. JC PEACE says:

    For me the difference is that visa is my money or wht ever u have in ur bank and,, and Mastercard is my credit cards so visa is debit card and Mastercard is creditcard , ,, thats how i see it

  76. Amjad Javed says:

    How can i see master gold card blence plz tell me?

  77. John Hauser says:

    Great comparison of Visa vs Mastercard. Well done.

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