Visa or Mastercard?
The two main credit card types have battled it out since the mid 1960s, but the credit card revolution was started in earnest by American Express, in 1958. Soon, their card was the choice to pay at hotels, airlines and restaurants.
Early Days
Eager to get in on the act, inn 1959, Bank of America first issued the Bank Americard, and soon other banks licensed the highly popular product from the bank. The Bank Americard was renamed Visa in 1976. From these humble beginnings, Visa International has grown into a membership association, owned by no less than 21,000 financial organisations across the world. Divided into six regions. Visa International creates systems, services and products for its members, which include credit card services. Visa Europe has over 5,000 members, who have issued more than 110 million personal Visa credit cards. Visa credit card holders in Europe spent Euro754.9 billion on their cards last year, and new credit card ownership was up 11.2%. Visa Europe is also the world leader in implementing chip and PIN technology, and works with all major European banks to create a better electronic payment infrastructure in Europe. The 42.8 million Visa UK card holders spent Euro127.6 billion on their cards last year.
Visa card levels
Visa cards come in a variety of formats, which follow the traditional credit limit and benefit levels of Classic, Silver, Gold and Platinum. Traditionally, the Visa card has been accepted more widely in Europe than Mastercard, and Visa Europe’s current and future focus seems to suggest this will continue to be the case. Despite the rapid conversion to chip and PIN, some Visa providers, such as Barclaycard Business, are still slow in delivering new chip and PIN cards. (By 14 February 2006, all in person card payments in the UK must be verified using chip and PIN.)
Verified by Visa
The Verified by Visa programme for the Internet tackles one of the major concerns in card use – internet fraud. The system adds another layer of security to transactions by requesting a personal password to accompany card details when purchasing goods online. Sign-up for card holders is free. Visa estimates that it will reduce by up to 80% the number of disputed transactions for retailers.
Mastercard
Mastercard began as a rival to the Bank Americard system, when four Californian banks created the Western States Bankcard Association in 1967, renamed MasterCard in 1979. Until about ten years ago, if you travelled to the USA, you had to have a Mastercard to be sure of having your credit card accepted. Now, the playing field is more level, but Mastercards are still accepted in more than 26.4 million locations worldwide, more than any other card. ATMs displaying the Maestro/Cirrus logo will accept Mastercards.
Mastercards come in a variety of formats, which again follow the credit limit and benefit levels of Standard, Gold and Platinum plus World. Just like Visa, Mastercard has implemented a verification process called SecureCode. Users sign up and receive a secret code that protects against unauthorised use of the card online. Unfortunately, unlike the Visa programme, card holders have to sign up with their card issuer rather than through one gateway site, and not all card issuers have signed up to the programme.
OK, but which one?
To sum up, Mastercard is accepted at more locations worldwide, but Visa has the better online verification process. To most consumers, this won’t sway them one way or another, especially when several credit card companies offer both Visa and Mastercard products. If the card holder travels widely, the best idea would be to have one of each, just in case. When shopping for the right credit card, however, ultimately the deal is far more important than the logo.
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