Visa vs. Mastercard: explained

Jordann Brown
by Jordann Brown June 25, 2020 / No Comments

Visa and Mastercard make up the vast majority of credit card options in Canada, and for the most part, the two types of credit cards are almost indistinguishable from each other. They are both widely accepted at most retailers, and you’ll find a complete spectrum of rewards credit cards, cash back credit cards, and low interest credit cards with either the Visa or Mastercard badge.

That said, whether to choose a Visa or Mastercard credit card is still one of the most common questions asked when selecting a new credit card. The truth is that there are some subtle differences that, depending on your unique spending patterns, may influence whether you should choose a Visa or Mastercard credit card. 

Here are the facts you need to know about Visa versus Mastercard to make your decision.

Mastercard vs. Visa: they’re virtually identical

First of all, both Mastercard and Visa are not credit card issuers. You can’t get a credit card directly from either of these companies. Neither Mastercard or Visa set credit card terms like interest rates or rewards schemes, and they don’t process credit card applications or play a role in whether or not you are approved for a credit card.

The company that manages the credit card is called an “issuer,” and issuers tend to be banks or credit unions. These organizations administer the credit card, their rewards, and points, and are responsible for the debt you take on when using your credit card. When you make your monthly payment, borrow money, or owe interest, you’re doing so through your bank or credit union – not Visa or Mastercard.

Instead, Visa and Mastercard are processing networks and perform more of the background work that’s out of sight of everyday cardholders. Both earn revenue by partnering with card issuers, acting as the middlemen between financial institutions and merchants, and handling the intricacies of processing digital transactions while ensuring you can use your credit card at a huge network of places – both online and offline. For instance, every time you swipe your credit card to make a payment at a retailer, Mastercard or Visa collects a fee.

Mastercard vs. Visa: the very subtle differences 

While Mastercard and Visa are incredibly similar in their offerings (the more significant differences lie with the credit cards offered by the issuers), there are some differences that you should keep in mind.

Not accepted at every retailer

Visa and Mastercard are both widely accepted by North American merchants, with 28 million merchants taking Visa and 30 million accepting Mastercard. Some notable merchants do not accept Visa, including Costco, No Frills, and up until recently, Walmart (though that’s now changed). If there are individual retailers that you regularly shop with, it’s a good idea to double-check that they accept the credit card of your choice. Alternatively, you can maintain a second backup credit card to cover all of your bases.

Extra perks

The second significant difference relates to your credit card perks and benefits. While the issuer determines many of the benefits offered by rewards and cash back credit cards, there are a few Visa and Mastercard perks that are specific to these companies. For instance, a Mastercard credit card with airport lounge access will provide you with a membership to Mastercard Airport Experiences. Like the name implies, Mastercard Airport Experiences is a Mastercard exclusive option. When Visa offers airport lounge memberships, they tend to do so through Priority Pass. Other slight differences in perks could include types of insurance available and differences in concierge services. If you have a specific set of perks you are looking for, you may find that either Visa or Mastercard does a better job at meeting your needs.

Infinite vs. World Elite

Finally, there is a difference between the premium tier Visa and Mastercards. You’ll be able to spot these premium tier credit cards because they’ll have a specific moniker. For Visa, the premium tier cards are “Infinite” cards (for example, the TD Cashback Visa Infinite). For Mastercard, the premium tier cards are “World Elite” cards (like the BMO World Elite Mastercard).

Here’s a summary of the benefits you’ll receive from each premium tier:

Infinite:

  • Priority Pass airport lounge access
  • 24/7 concierge
  • Up to 12 types of insurance coverage
  • Visa Infinite Dining Series
  • Visa Infinite Wine Country Program
  • Visa Infinite Luxury Hotel Collection

World Elite:

  • Lounge Key airport lounge access
  • 24/7 concierge
  • Up to 15 types of insurance coverage
  • Mastercard Priceless Cities
  • Cirque du Soleil
  • Mastercard World Experiences
  • Complimentary Boingo wi-fi membership

Depending on your requirements, these perks could tip the scales in favour of one over the other. For example, if you’d prefer Priority Pass airport lounge access, it’s best if you go with a Visa Infinite credit card.

Some of the best Visa and Mastercards in Canada

TD CashBack Visa Infinite


  • Annual fee: $120 (waived for first year)
  • Get 3% cash back on gas, groceries and recurring bills
  • Earn 1% cash back on all other purchases
  • Welcome Offer: Earn 10% cash back on eligible purchases for first 3 months (on up to $2,000 in spending)
  • Complimentary roadside assistance and travel insurance benefits
  • Income required: $60,000

Home Trust Preferred Visa

  • No annual fee
  • 0% foreign transaction fees on purchases abroad
  • Earn 1% cash back on all Canadian purchases, with no limit on the amount you can earn
  • Complimentary roadside assistance membership
  • Not available to residents of Quebec
  • Income required: No specific amount

Tangerine Money-Back

  • No annual fee
  • Earn 2% cash back on purchases in up to three categories of your choice, and 0.5% cash back on all other purchases
  • Income required: $12,000

MBNA Rewards Platinum Plus

  • No annual fee
  • Earn 2 points per $1 on gas, groceries and restaurant purchases ($5,000 annual cap on each category)
  • For the first 90 days, earn 4 points per $1 spent on the three bonus categories mentioned above
  • Earn 1 point per $1 spent on all other purchases
  • Welcome offer: Get up to 10,000 bonus points
  • Income required: No specific amount

The final word

Bottom line: your choice for a new credit card should not be made solely on whether it’s a Visa or Mastercard. 

There’s a wide variety of other criteria to take into consideration, like interest rate, monthly fees, rewards, and perks. These criteria will have a much more significant impact on the utility of your credit card choice than whether it is a Visa or Mastercard. That said if you are comparing two credit cards that are virtually identical in stats, whether they are a Visa or Mastercard could tip the scales in your final decision. 

 


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