American Express, Discover, Mastercard and Visa are the four major credit card processing networks that oversee every card transaction from start to finish. Their job includes approving or declining a purchase, protecting shoppers and merchants from fraud, and making sure money flows to and from the appropriate accounts.

But each company does things their own way, and two even issue credit cards of their own. Your card’s processor determines where and how you can use it, so read on to learn more.

Major credit card processors, compared

Processing vs. issuing

A credit card processing network acts as the liaison between your bank and a merchant’s bank. When a payment is initiated, a processor analyzes the request, confirming that the request is real and you are the one making it. 

If everything looks legit, it approves the transaction, takes the money out of your bank (or applies the charge to your credit card) and pays the merchant. Visa, Mastercard and Square are all credit card processors.

Credit card issuers provide credit cards to consumers. They do all of the vetting — reviewing applications to see if you’re qualified and reporting payments (and missed payments) to credit bureaus. They also handle customer service: If you ever have a concern about a transaction or want to dispute a payment, call your credit card issuer using the number on the back of the card. Chase, Bank of America and Wells Fargo are examples of credit card issuers.

American Express and Discover are the only major processors that also issue cards. If you have a Visa or Mastercard card, it’s always going to be linked to an issuing bank such as Capital One or Barclays. American Express and Discover may offer cards through separate issuers too, but they have the capacity to issue their own cards. For instance, Discover serves both as the issuer and processor for its Discover it® Cash Back card.

Acceptance

Credit card processors make money by collecting a percentage of every transaction that comes through their credit card network. Part of the reason that American Express cards aren’t accepted as widely as others is that it charges merchants a higher fee on average.

Still, each of the four major credit card processors do business with millions of merchants in more than 100 countries. Visa and Mastercard work with the most merchants worldwide at more than 100 million each, according to the Nilson Report.

Eligibility 

There are dozens of credit cards in the market — from airline and travel cards to cash-back cards. Each comes with its own set of eligibility requirements that consider credit score and history. American Express may be the most stringent issuer when it comes to eligibility; most of the company’s cards require applicants to have a credit score of at least 670.

There are also credit cards designed for those with fair credit (580-669), bad credit (300-579) and no credit. These cards will typically come with fewer perks, but they can help you build your credit.

Pros and cons of each card processor

Major credit card networks and processors have benefits and drawbacks. It’s important to consider where you shop and the type of card you’re most interested in before applying.

American Express

Discover

Mastercard

Visa

Emerging trends and innovations

Credit card processing companies are always looking for ways to improve safety for online and in-person transactions while making the process more seamless for consumers. Here’s a rundown of some of the emerging innovations and trends from some of the major credit card networks over the last year:

• American Express aims to improve supply chain issues: Amex has introduced a wave of technologies to help improve supply chain issues, including increased data visibility, multi-tiered partnerships and specialized training for supply chain executives.
• Discover launches the Discover Technology Experience: This new online portal aims to help professionals sharpen their skills and “grow their careers through knowledge sharing.”
• Improved cross-border remittances: As more money is moved across borders, Visa has taken steps to make the process more convenient and affordable. According to Visa, some 800 million people receive remittances across borders annually and that number could increase in the coming years.
• Increased use of artificial intelligence (AI): Visa reports that hackers and thieves are trying to use AI to find new ways to commit fraud. The card network said it’s currently leveraging more than 60 different AI capabilities to speed up payments to banks, improve user experiences and combat this type of fraud as it takes shape.

Which processor is best?

At the end of the day, the credit card processing company that oversees your payments won’t make a meaningful difference in your life. After all, the four major credit card processing companies all offer efficient payments and plenty of security measures to keep your personal information safe.

What will make a difference in your life is the actual credit card you apply for and whether you opt for an introductory 0% APR credit card, a rewards credit card or a travel credit card.

Make sure to compare options across American Express, Discover, Mastercard and Visa to find the right fit.

More credit card advice

• How to Choose a Rewards Credit Card
• Best Balance Transfer Credit Cards