How Do Visa’s and Master Card’s International Businesses Compare?

August 12th, 2016 by Trefis Team
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MA: Mastercard logo
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Mastercard

visa master card comp2

Visa (NYSE: V) and Master Card (NYSE: MA) are two of the largest payments companies. They get a large part of their business from international operations. Gross revenue from international operations is calculated as the revenue generated from transaction fees net of the rebate paid by each company per transaction. Over the 2011-2015 period, Master Card’s international transactions gross dollar volume (GDV) has grown faster at 9% than Visa’s at 8.1%. Both companies have kept the fee paid per transactions constant at 1% over the period. However, Visa’s rebates paid per transaction have grown much slowly compared to Master Card’s, leading to the outcome that its revenues have grown faster than Master Card over the period. If this trend continues in the future, expansion might not result in as much growth for Master Card as it might expect.

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Notes:

1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for MasterCard
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