Sunday, 13 May 2012

Weekend Warrior: Visa or Mastercard? Does it make a difference?

While I was doing research for a blog post that I want to write on credit cards I came across this great article written by the credit products review website Canstar.  It was a brief article on the difference between Visa and Mastercard (and whether it makes any difference when you are choosing what credit card to select).

Visa and Mastercard are actually only processing systems which allow the retailer to process charges from your financial institution.  They actually have nothing to do with the issuing of cards or the payments that flow too and from you to the retailer.  Nor do they have anything to do with your rewards programme, the fee you get charged or the interest rate you get charged.

Given that both cards are accepted in over 200 countries and that most retailers accept either Visa or Mastercard it actually makes very little difference which one you have as there is unlikely to be a situation where one is accepted and the other is not (note that American Express does not have anywhere near this level of penetration and I have seen plenty of signs saying Visa or Mastercard only). Therefore it makes little or no difference whether you choose Visa or Mastercard.  Much more important is the financial instution that you choose and the deals that they are offering for your credit card.

If you want to be safe then if you have two credit cards you can make one a Visa and one a Mastercard.  Note that if you do want an Amex I would strongly recommend also getting a Mastercard or a Visa.  I would never recommend Diners Club as I don't think they are widely accepted outside the United States (Diners Club is a traditional charge card where the balance has to be paid off every month)

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