Now we come to answer the question, of whether American Express is a Visa or a Mastercard. The plain answer to this question is it is neither a Visa nor a Mastercard, it is an AmEx or American Express card. American Express is a separate payment network that works worldwide just like the other very common and renowned payment networks in concern which we know as VISA or MASTERCARD. American Express, Visa, and Mastercard are three of the four prime card networks, but American Express also offers credit and issues cards directly to customers. A single credit card cannot be linked to two networks at the same time, i.e a card can only be associated with one network at a time a credit card cannot be an American Express Visa Card or an American Express Mastercard. Most of the cards under AmEx cards are issued by American Express itself, while Visa and Mastercard do not issue any credit cards on their own accord.
WHAT IS AMERICAN EXPRESS (AMEX)
AmEx or American Express is a world-famous MNC that specializes in providing luxury credit cards almost all over the world. American Express offers world-class charge and credit cards, rewards, gift cards, personal savings, travel, business services, Insurance, and more. American Express has its headquarters at 200 Vesey Street in the Battery Park City neighborhood of Lower Manhattan in New York City.
Despite being a company specializing in extending credit to customers, AmEx is also a luxury payment card provider, i.e, It does not just act as a credit and payment network but also as a credit provider.
This is the major distinction between other networks like Mastercard and Visa which only act as a payment network globally but AmEx is out here not only as a payment network provider but also issuing its own cards and also providing credit.
AmEx VS. VISA VS. MASTERCARD
Even after AmEx, being the one to issue its own cards. Visa and Mastercard stand to dominate the global payment system. Where American Express is a great service provider the other two networks in consideration are far more widespread.
SPREAD OF THE NETWORKS
AmEx – 160+ countries
VISA – 200+ countries
Mastercard – 210+ countries
The main reason for this slightly less popularity of The American Express might be that it does not accept clients/ customers who have a less than stellar credit score. When choosing your next credit card you need to check in with your credit score as it definitely plays a role in highlighting what payment networks you have as an option.
NUMBER OF CARDS CIRCULATED IN THE U.S.
(as of 2019)
AmEx – 54.7million
VISA – 333.1million
Mastercard – 243 million
As we can decipher from the above statistics it’s clear that AmEx is very particular about who gets to hold their credit cards.
Now how is a card issuer different from a payment network let us talk about that?
A card issuer is one that actually extends credit to consumers. When you use your card, the card issuer pays for the transaction upfront and gets reimbursed when you pay off your bill each month.
When you are issued an American Express card, you will only deal with American Express.
With Visa and Mastercard, you will have a card issuer that is typically a bank.
A payment network mediates the transactions, i.e., it helps in the processing of transactions. This implies it transfers funds from the card issuer to the merchant.
For ex-
Chase is the credit card issuer, and Visa is the payment network.
American Express processes transactions for both, its own cards, i.e., American Express cards, and the other ones, like the other card issuers who use American Express as their payment network.
For ex-
Bank Of America, USAA, Wells Fargo, Citigroup, and U.S. Bank use the AmEx network to carry out their transactions.
CARD FEATURES LIKE HOTEL AND AIRLINE TIE-UP
If you are looking for a card from a specific airline or hotel. In that case, you need to choose a specific network.
For ex-
American Express is the only network that renders Delta and Hilton cards.
Visa only provides United and Southwest cards.
Mastercard only offers IHG or Hawaiian Airlines cards.
CONCLUSION
In the end, the inference drawn from this article is if most of your transactions take place in the U.S., then you will not face any problems in using an AmEx card. However, if you are planning on traveling abroad Visa or Mastercard may be a wiser option for you. Although, keeping cards of distinct payment networks at all times when traveling might work in your favor.
Choosing the card based on the credit card issuer and certain specific features of a card can be a bit of a headache than choosing a card based on the processing network. Each network has its own boons and banes, different levels of customer service, and rewards. All these elements also play a role in the decision-making.
