Ever look at your debit or credit card and see "Mastercard" or "Visa" stamped on it? Those logos are like the superheroes of your card, but have you ever wondered what they actually do?

Let’s dive into the cool world of Mastercard and Visa!

First of all, they are not providing cards!

First and foremost, it's important to clarify that they do not provide cards, at least not technically. Both Mastercard and Visa are financial services businesses that primarily function as payment network processors. They act as third-party service providers, facilitating electronic transactions between various parties involved in a payment transaction.

They are like the conductors of a giant electronic orchestra, making sure your payments go smoothly. If your card has a Visa logo, it's like a magical key that lets you pay in different countries. Imagine using your Japanese SMBC debit card when you visited one of the restaurants in Vietnam – all thanks to that little Mastercard or Visa logo!

So, how do they work? These companies partner with member financial institutions that issue company-branded cards to consumers, students, and small businesses. Member financial institutions often collaborate with organizations in co-branded relationships to issue company-branded rewards cards to their customer bases. These organizations can include airlines, hotels, and retailers.

When these companies partner with a financial institution, the institution serves as the issuer, determining the terms and benefits that a cardholder can receive on their card. A financial institution may choose to partner for the issuance of a credit card, debit card, or prepaid card.

Then, what's the difference between them?

Mastercard and Visa are just distinct companies providing the same service. That’s it.

Mastercard and Visa are competing with each other. They are in the top four payments worldwide, competing with American Express and Discover. Looking at the rank, Visa has outpaced Mastercard over the years.

As services provide a network, you might be interested in looking at the acceptance of these cards worldwide. Both have an extensive network, spanning over 200 countries and 15,000 financial institutions, but Mastercard has more partnerships, boasting over 25,000 financial institutions.

They also offer different benefits. For instance, some Visa and Mastercard products provide payment network benefits like cellphone insurance, travel accident insurance, or trip cancellation and interruption insurance.

However, it's crucial to note that not all Visa or Mastercard credit cards offer the same selection of benefits. As mentioned earlier, card issuers, in this case, financial institutions, can choose which benefits come with different card products and may even offer separate benefits of their own.

Which one should I choose then, especially in Japan?

Japan has its own superstar called JCB, but don't worry; both Visa and Mastercard are generally accepted in Japan too. American Express might get a cold shoulder from some Japanese shops because of higher fees.

One thing to know – outside Japan, JCB is like a VIP card for Japanese tourists. So, if you're traveling between Japan and your home country a lot, we would suggest you stick with a Visa or Mastercard card. They're like your international buddies.

So, the next time you glance at your card and spot those "Mastercard" or "Visa" superheroes, know that they're not just logos; they're the maestros orchestrating a global payment symphony. Yes, that's true!

This blog post was accurate at the time of publication.