The battle of the cards

Choosing a new credit card can be overwhelming. But maybe you can make things a little easier by first asking yourself: Visa or MasterCard? We break down the differences for you.

The real difference in the Visa vs MasterCard debate lies with these cards’ issuers (banks). Neither Visa nor MasterCard actually issues the credit cards themselves. As Nerdwallet says, Visa and MasterCard are networks that process payments between banks and merchants for purchases made with the cards.

Probably the greatest similarity is that both have different tiers (levels) in which you may receive different benefits (largely related to travel). The higher the tier, the better the benefits. Visa cards have two tiers of benefits: the entry-level Visa and its premium offering, Visa Signature.

Entry-level cards normally come with 24/7 assistance around the globe, emergency card replacement and cash advances in emergencies. In addition to these benefits, Visa Signature cards offer travel insurance, airport lounge access, other travel and lifestyle privileges, and concierge services.

MasterCard has three main tiers of benefits: the base, World and World Elite.

Whereas the entry-level card has similar benefits to that of Visa, the World and World Elite programmes are for eager travellers and include luxury travel, lifestyle and insurance perks.

The difference between the two is that World Elite cardholders receive benefits from several extra travel providers, which can include upgrades to business class when the purchaser pays for a full fare economy class ticket.

Unless you’re a big spender or frequent traveller, it doesn’t really matter whether you go for Visa or MasterCard.

What matters is which issuer (bank) you decide on and what they offer in rates and benefits.

What is the monthly salary requirement, the annual fee, the repayment periods and interest? What perks or rewards do they offer and do these fit in with your financial and life goals?

Issuers tend to reserve the cards with the greatest perks for those with good credit scores. But, if you’re looking for a card to use in emergencies or to improve your credit score, there are still many incredible options.

Just do your research on each and choose the one you know will serve you best.

Shirley Smith is Old Mutual Finance COO

This was published on the Old Mutual Finance blog.