Visa and MasterCard Still Make Money - Visa and MasterCard, the two largest network brands of credit cards and debit cards are both well positioned to ride out the global recession. That's because these two companies make money on the transaction every time a consumer uses a card, but they don't hold the debt accumulated by consumers, which is the duty of banks such as Citibank, Chase, Wells Fargo, Bank of America, and Capital One, known as the issuing banks.
This has influenced Visa and MasterCard to push the concept of ‘electronic over cash’ payments in their recent advertising campaigns. The two brands also realize that the recent surge in debit card usage over the last 3 years makes for an interesting transformation from credit card debt to debit card pay now with no regrets.
The ‘pay as you go’ shift isn't short term either, with many believing it is a change in consumer behavior that credit card companies and banks will have to accept for the long run. Debit cards and prepaid debit cards will become even more popular as ideas such as paying down debt and living without excess take center stage in the United States and worldwide. |
