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Credit card networks vs. issuers: What’s the difference?

Knowing the difference between issuers and networks can help you better understand your credit card choices.

You have many options when it comes to a credit card — big name brands, popular banks, rewards points, miles, no annual fee and even complimentary airport lounge access. But who issues the cards in your wallet, and why does it matter?

Simply put, a network decides where a credit card can be used, while an issuer distributes its branded cards to customers.

Credit card networks

Credit card networks are the bridge between merchants — the shops that accept your credit card — and the banks that issue the credit cards themselves.

Of the networks, you’ll find three major players in Canada: Visa, Mastercard and American Express. Visa’s network owns the wide majority of the market share worldwide, followed by Mastercard and then American Express.

Networks set the fees that a retailer pays when you swipe your card for purchases. Called interchange fees, these costs can vary by credit card brand, swipe location and transaction type — for instance, in a store, online or by phone. Merchants typically pay around 1.5% to 2% of your total transaction in fees to the network.

Credit card networks are responsible for:

  • Deciding where credit cards can be accepted.
  • Approving and processing transactions.
  • Facilitating payments among cardholder, merchants and issuers.

Credit card networks are not responsible for:

  • Determining fees that a cardholder pays, like your card’s annual fee, interest rates, late fees or foreign transaction fees.
  • Customer service.

Credit card issuers

A credit card issuer is who you actually get your credit card from.

Visa and Mastercard are networks only. Branded Visa and mastercards are issued directly from what we call credit card companies — or the banks and credit unions themselves, like RBC, TD, Tangerine and President’s Choice. To learn who issues your card, take a good look at it – you’ll often see the logo of the bank that issues your card somewhere near the Visa or Mastercard logo.

As underwriters, these credit card issuers or companies are responsible for:

  • Reviewing and approving credit card applications.
  • Setting the terms and conditions of individual credit cards such as annual fees and interest rates.
  • Issuing the physical cards you hold in your wallet.
  • Providing funds up to your credit limit.
  • Answering questions and providing other support to customers.

How do credit card issuers make money?

Credit card issuers profit from both the cardholder and the merchants who accept payments on its cards. Specifically, revenue can come from:

  • Interest fees charged to the cardholder on purchases and balance transfers.
  • Annual fees cardholders pay to use these cards.
  • Overlimit fees when charges and interest nudge a balance over a cardholder’s credit limit.
  • Late fees when a payment is received after a statement date.
  • Credit monitoring and protection along with other optional services provided to the cardholder for a fee.
  • Swipe fees charged to the merchant, typically split between the issuer and the network.

American Express: network and issuer

Unlike Visa and Mastercard, American Express is both a network and an issuer. This means that even if your American Express is branded with a bank or company, your card will likely come directly from Amex.

As an issuer and a network, American Express set the fees for both the cardholder and the merchants who make sales through their network.

Unlike Visa and Mastercard, American Express handle their own customer service. If you lose your Amex in France, you’ll contact American Express directly, whereas you’ll have to call your issuing bank if you lose your Visa or Mastercard.

Visa and Mastercard

Visa and Mastercard are the two most popular credit card brands in the world. They don’t directly issue credit cards, rather they brand cards issued by banks, credit unions and other financial institutions.

Rewards and interest rates are decided by the bank, credit union or other company — for instance, an airline or hotel — they’re working with to issue the card.

Both cards come with global acceptance, but Mastercard is more widely accepted worldwide: It can be used in more than 210 countries and territories worldwide compared to Visa which can be used in just over 200. This statistic could be important depending on where you travel.

Card types

Visa and Mastercard come with the following general membership cards, each offering benefits such as fraud protection, emergency assistance, card replacements and extended warranties. Upgraded cards often come with complimentary airport lounge access, rewards programs and travel insurance coverage.

Visa

Mastercard

Compare credit cards

Name Product Welcome Offer Rewards Purchase Interest Rate Annual Fee Min. Credit Score Description
Finder Award
OFFER
HSBC +Rewards™ Mastercard®
30,000 Points
2x points per $1 spent
11.9%
$0 annual fee for the first year ($25 thereafter)
Min. recommended credit score: 630
Get 30,000 Points (up to $150 in value) when you spend $2,000 in the first 6 months. Plus, get the 1st year annual fee waived for the primary cardholder ($25 value). Apply by January 31, 2022.
BMO CashBack Mastercard
5% cash back
Up to 3% cash back
19.99%
$0
Min. recommended credit score: 660
Get 5% cash back on all eligible purchases in the first three months of card membership (up to max. spend of $2,000). Plus, get a rate of 1.99% on balance transfers with a 1% balance transfer fee for nine months.
Tangerine World Mastercard
15% cash back
Up to 2% cash back
19.95%
$0
Min. recommended credit score: 600
Earn an extra 15% cash back (up to $150) on up to $1,000 of everyday purchases in the first 2 months Until January 31, 2022. Plus, get a 1.95% interest rate on balance transfers for the first 6 months (valid within the first 30 days of account opening, 1% transfer fee applies).
Neo Financial Credit Card
N/A
Average 5% cash back
19.99% - 24.99%
$0
Min. recommended credit score: 600
Earn an average 5% cashback at thousands of partners and at least 1% cashback guaranteed. Neo partners with major gas and grocery stores, restaurants, gyms, coffee shops and more.
BMO Preferred Rate Mastercard
3.99% rate on balance transfers for 9 months
N/A
12.99%
$20
Min. recommended credit score: 660
Get a rate of 3.99% on balance transfers for 9 months with a 1% transfer fee. Plus, get the $20 annual fee waived in the first year.
American Express Cobalt Card
50,000 points
Up to 5x points per $1 spent
20.99%
$155.88
Min. recommended credit score: 700
Earn up to 50,000 Membership Rewards points in your first year. Earn 2,500 Membership Rewards points for each monthly billing period in which you spend $500 in net purchases on your card (up to 30,000 points). Plus, earn a Welcome Bonus of 20,000 Membership Rewards points when you spend a total of $3,000 in purchases on your Card in your first 3 months of Cardmembership.
Brim Mastercard
Up to $200 worth of bonuses
1 point per $1 spent
19.99%
$0
Min. recommended credit score: 700
Earn up to $200 worth of bonus points when you shop with Brim retailers for the first time through the Brim mobile app.
Tangerine Money-Back Credit Card
15% cash back
Up to 2% cash back
19.95%
$0
Min. recommended credit score: 600
Earn an extra 15% cash back (up to $150) on up to $1,000 of everyday purchases in the first 2 months Until January 31, 2022. Plus, get a 1.95% interest rate on balance transfers for the first 6 months (valid within the first 30 days of account opening, 1% transfer fee applies).
SimplyCash Card from American Express
4% cash back
Up to 1.25% cash back
19.99%
$0
Min. recommended credit score: 700
Earn 4% cash back on purchases (up to $200 cash back) for the first 6 months of Cardmembership.
American Express Green Card
10,000 points
1 point per $1 spent
20.99%
$0
Min. recommended credit score: 700
Earn a Welcome Bonus of 10,000 Membership Rewards points when you charge $1,000 in purchases to your card in the first 3 months as a new Cardmember.
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Major differences among networks and issuers

VisaMastercardAmerican Express
Nationwide acceptance
Global Acceptance

Variety of choicescross-icons
Network
Issuercross-iconscross-icons

Bottom line

It can be hard enough to narrow down your options when it comes to choosing a credit card. Knowing the difference between a network and an issuer can help you better understand how you ultimately use and benefit from your credit card choice.

Before applying for a credit card, compare your options to find a card that works for your needs and financial situation. You can begin your comparison here using our credit card guide.

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