It’s easy to flick through the cards in your wallet and think all credit cards are alike. Apart from being a different colour they all looks similar and can be used to buy goods and services. However, there is much more too it than this and the card you choose can make a big difference in terms of how much it costs you, where you can use it and what you get back as reward.

Bank cards are owned by banks, and each one has its own set of terms and conditions. To facilitate payments and broaden its use in more places, the bank usually joins a credit-card interchange network  either Visa or MasterCard  or, in many cases, both networks. By joining these networks a bank’s card can enjoy countrywide and worldwide acceptance.

Therefore often see cards bearing both the Visa (or MasterCard) logo along with the issuing bank’s logo. Visa cards do not come directly from Visa; only the Visa-member bank issues the Visa credit cards directly to consumers.

Travel and entertainment cards are issued directly by the card providers, such as American Express and Diners Club, but may be distributed through banks. The issuer, American Express, for example, is the credit provider not the bank.

Credit Limits

Visa cards provide revolving credit  you can choose to pay the bill outright before the due date each month or a lower amount that meets the minimum due. Due to the revolving credit facility, a Visa credit card comes with a pre-set spending limit.

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Unlike Visa credit cards, American Express cards do not have a pre-set spending limit. American Express cards are charge cards and do not provide a revolving credit. Normally you are required to pay in full the amount owing each month.

Worldwide Acceptance

The biggest issuer by far of travel and entertainment cards is American Express. But despite its size, its numbers are minuscule compared to number of Visa cards in circulation  American Express cards are only about 15% of the total outstanding Visa credit cards (and about 14% of all outstanding MasterCard cards).

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