MasterCard and Visa are two of the most widely used global payment networks, but many people don't know how they actually work behind the scenes. Let’s break it down simply.
💳 What Is a MasterCard or Visa Card?
They are payment cards (credit, debit, or prepaid) issued by your bank, but the network (MasterCard or Visa) processes the payment.
-
Visa/MasterCard: Not banks. They’re payment networks that transfer transaction data.
-
Your Bank: Issues the card and handles the money.
🔁 Step-by-Step: How a Transaction Works
Scenario: You swipe your Visa or MasterCard at a store.
1. 🛒 Swipe or Tap
You give your card (or use it online) to pay for something.
2. 📡 Transaction Sent to Payment Network
The merchant’s machine sends your card info to Visa or MasterCard’s network.
3. 🏦 Forwarded to Your Bank (Issuer)
Visa/MasterCard routes the request to your bank, which checks:
-
Do you have enough money/credit?
-
Is the transaction legit?
4. ✅ Approval or Decline
Your bank approves or denies the transaction in seconds.
5. 📲 Back Through the Chain
The approval message goes back to:
Your Bank → Visa/MasterCard → Store → Payment Complete.
6. 💸 Settlement Happens Later
Behind the scenes (often at day’s end):
-
Your bank sends money to the store’s bank.
-
Visa/MasterCard gets a tiny fee for processing.
🧾 Summary:
MasterCard and Visa don’t give you money — your bank does.
They simply act as fast, secure messengers between you, your bank, and the store.