Visa and MasterCard

Visa and MasterCard’s competitors include any banks and other entities that issue cards and provide card acceptance services to merchants, including PayPal and other “digital wallet” network along with other major credit card companies. They compete with their competitors in two market levels – upstream and downstream markets. The two compete with American Express, Discover/Novus, Diners Club, and Japan Credit Bureau in an upstream market, in regards to the all-purpose card network market. They’re banks also compete with each other and with the aforementioned companies in two downstream markets as well – the card-issuing markets, the market for issuing general purpose cards (credit cards and charge cards) to consumers; and the card acceptance markets, the market for providing the services that enable merchants to accept general purpose cards for the purpose of goods or services. In the United States, both Diners Club and Japan Credit Bureau, two Visa and MasterCard’s general purpose card network competitors, compete on a relatively smaller and insignificant competitive market with limited merchant acceptance. Another form of competition for Visa and MasterCard are card issuers. They may compete on interest rates, fees, enhancements, and customer service.
Since Visa and MasterCard first opened in the late 1950s, only Novus (formerly Discover, starting as Sears) has succeeded in entering the general purpose card network. It has become quite difficult to enter this market because of the cost of building a merchant and cardholder base, forcing new competition to enter the market solely by becoming members of Visa and MasterCard. In addition, Visa and MasterCard have adopted and implemented “anticompetitive” rules and policies that might restrict the ability of all member banks to do business with American Express, Discover/Novus, or any other network that the controlling banks consider to be competitive, which in turn makes it even more difficult for new entry into