Card Card service providers

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Hi folks, you might be thinking that Banks or financial institutions are the service providers who offer credit cards and their is no need to learn about service providers.

In today's article, let me tell you that Banks offer credit and debit cards to customers but the actual service providers that enable these cards to be used worldwide are 3.

1) Visa Incorporation
2) Master Card
3) American Express

You may have seen their logos on all the debit or credit cards that one holds. The logos depict that the card can be used any of the merchant outlet that accepts payments via visa or master card. Both visa and Master Card does not issue cards or provide credit to customers, rather to provide Banks and Financial organisations with a payment gateway that allows their customers to use the cards.

You may have noticed that i have not spoken anything about American Express till now and only discussed about Visa and Master. I did that on purpose as Visa and Master card offers or rather sells their network to various Banks and Financial Institutions but American Express network is the only network that offers their Credit Cards. American Express cards are only accepted at the terminal which has a tieup or relation with American Express. This is done to ensure that the money made out of every transaction are kept by American Express and not shared.

visa and Master share the revenue generated from every transaction with the Bank involved in the credit card. These gateways or the funds transfer facilitated by Visa and Master Card plays a major role in the global financial system as you may see that a Card issued in United States works in India or Japan or anywhere the network is available. The global financial system pertaining to credit and debit cards would not have flourished to the extent it has now if these payment gateways were not available.

Every transaction that happens at any of the Visa or Master terminal, the merchant is charged a percentage of the transaction value and the revenue is then shared between the Bank and the payment gateway provider which may be Visa or Master card.

So next time you use your card to purchase something at a grocery store or visit any ATM outside your county, remember that it is possible only due to these payment gateways