Mastercard and Visa's long-standing dominance in global payment networks is facing potential disruption from new technologies. These companies provide the essential infrastructure that allows transactions to occur seamlessly worldwide, connecting cardholders, merchants, and their banks.
Unlike firms such as American Express, Mastercard and Visa operate an asset-light model. They do not lend money, issue most cards, or bear the risk of unpaid credit card balances. Instead, they provide the rules, technology, and communication networks that enable thousands of financial institutions to work together.
The networks' origins trace back to the 1950s and 1960s, when Master Charge and Bank Americard were established to create common standards for fragmented consumer payments. Between 2006 and 2008, both companies demutualised and listed in New York, transitioning from industry utilities to technology companies focused on network expansion and investment in areas like fraud detection and cybersecurity.