What Is Mastercard?

MasterCard is the second-largest payments network, ranked behind Visa, in the global payments industry. Other major payment networks include American Express and Discover. Mastercard partners with member financial institutions all over the world to offer Mastercard-branded network payment cards.


Mastercard uses its proprietary global payments network, which is referred to as Mastercard’s core network, to facilitate payment transactions, which usually involve the Mastercard account holder and a merchant, along with their respective financial institutions. Payments can be made via credit, debit, or prepaid cards.

  • Mastercard is a payment network processor.
  • MasterCard partners with financial institutions that issue Mastercard payment cards, which are processed exclusively on the Mastercard network.
  • Mastercard’s primary source of revenue comes from the fees it charges issuers based on each card’s gross dollar volume.

Mastercard Explained

Mastercard itself is a financial services business that primarily generates revenue from gross dollar volume (GDV) fees. Mastercard cards are issued by member banks with the Mastercard logo and are characterized as “open loop”. This means the card can be used anywhere the Mastercard brand is accepted.


Across the payments industry, there are four major payment card processors. These four card processors are Mastercard, Visa, American Express, and Discover. Each company operates a payments network and partners with a variety of institutions for card offerings.


All electronic payment cards have cardholder numbers that begin with an issuer identification number (IIN), which distinguishes the network processor for electronic payments. The IIN can help identify the card brand if a logo is not visible.


The Mastercard Business

In 2020, Mastercard reported $6.3 trillion worth of gross dollar volume, which shows the amount of money comprehensively transacted on all of its card offerings.


The company partners with a variety of institutions to offer several types of cards. Comprehensively, its card offerings include credit, debit, and prepaid cards. The majority of Mastercard’s business is through partnerships with financial institutions and their organizational co-brand partners to offer open-loop credit card options.