Who says there is no competition in the cards world?

The European Commission has continuosly stressed the need for a pan-European card scheme as an alternative to Visa and MasterCard. The chief argument goes that the existing duopoly of the two giants limits competition and choices for the European banks. There was a time perhaps when the association status of both schemes used to colour their commercial judgement. I also remember their own messages at a time, which went along the lines “we are not competing against each other, we are both competing against cash”. Sure, cash remains an important target for both Visa and MasterCard, however, since their respective IPOs, I am seeing an increasingly fierce competition between these two firms. Both of them have been very active in staking the ground in contactless (Visa with payWave and MasterCard with PayPass) and mobile services. My UK bank has recently replaced my Maestro debit card with Visa debit – a clear sign that the competition between the two for bank accounts also remains strong. However, a number of recent announcements indicated that we might be entering a new phase in the “battle of giants”. It didn’t take long after Visa announced its intentions to strenghten its position in e-commerce with the acquisition of CyberSource, for MasterCard to follow with its own acquisition of Datacash, a European e-commerce service provider. And while MasterCard’s announcement on August 30th to partner with Borderlinx, a company that helps facilitate cross-border e-commerce, is still fresh in our minds, we should also note that Visa has done a similar deal with Borderlinx for its customers in the GCC region back in April 2010. Who says there is no competition in the cards world?
Zilvinas Bareisis About Zilvinas Bareisis

Zilvinas Bareisis is a senior analyst with Celent's Banking practice. His research focuses on retail payments, including cards, e-commerce, and mobile payments. He has a global perspective with a particular emphasis on market developments in North America, the UK, and Europe.


  1. Hi Zilvinas,

    What does all this mean from a corporate cards perspective? This is something we are keenly interested in on CFOZone.com.

    Thanks for the update,

    Denise Bedell
    Finance/Treasury blogger

    • Zilvinas Bareisis Zilvinas Bareisis says:


      I don’t think it means much from the corporate cards perspective other than that you can expect an increased competition in this area as well. My view is that these specific, e-commerce related announcements are aimed at improving services to consumers and merchants rather than corporate customers. However, it would be interesting to hear from our readers if they see how these additional capabilities and partnerships can help the card schemes compete in the corporate customer space.

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