Credit Card Companies in Australia – Forbes Advisor Australia

Credit cards are a widely accepted, convenient and fairly secure alternative to debit cards, cash and other payment methods. Perks including rewards, travel benefits and purchase protection make credit cards a more attractive option for consumers — making credit cards big business.

Credit card companies are credit unions, banks, payment networks, and other financial institutions that issue credit cards and facilitate credit card transactions to consumers and business owners. A card issuer is different from an issuer network, although some issuer networks are also issuers. Let’s explore the differences.

What is a credit card company?

Credit card companies are classified as payment networks and/or card issuers.

Four major credit card networks dominate the Australian market: American Express, Mastercard and Visa. Each credit card network (also known as a card association) may work slightly differently, but the fundamentals remain similar.

Card networks help move funds from cardholders to merchants. When you make a purchase with a credit card, the payment processor uses the card network to pass transaction information between the merchant’s bank (also known as the acquiring bank or acquirer) and the financial institution that issued the card.

A credit card issuer is a bank or credit union that provides credit cards directly to end users, such as consumers or small business owners. Major banks also frequently act as credit card issuers in Australia: Commonwealth Bank, Westpac, Macquarie Bank, NAB and ANZ are all issuers.

Credit Card Networks and Credit Card Issuers

While credit card networks facilitate the transfer of information, credit card issuers offer credit cards to consumers and businesses. A card issuer is the one that determines who is eligible for a revolving line of credit, charges consumers and offers rewards. As a cardholder, you will primarily be dealing with your card issuer (not the card’s network) when taking actions such as paying a bill or reporting your card lost.

If you want a Visa or Mastercard credit card, you will need to apply through another financial institution, such as Commonwealth Bank or Westpac. American Express is different from other credit card networks because these financial companies also issue credit cards.

List of credit card companies used by Australians

American Express

American Express describes itself as a payments service that provides customers with “products, insights and experiences that enrich lives and build business success.”

The company’s payment platform involves issuing cards and operating payment networks. American Express customers include consumers, small businesses, mid-sized companies and multinational corporations.

American Express cards are not issued exclusively by American Express, but many of the best American Express cards are.

ANZ

ANZ – Australia and New Zealand Banking Group – is one of Australia’s “Big Four” banks and is one of the largest financial institutions in the country. ANZ provides banking and financial products and services to more than 6 million domestic customers and approximately 9 million customers globally.

A banking giant, ANZ offers its customers a range of credit cards to suit business, lifestyle and personal needs. At the time of writing, ANZ has 10 different cards available, including low interest rate cards and frequent flyer rewards credit cards.

australian bank

Australian Bank is a customer-owned bank, which means that each of its customers is an equal shareholder, regardless of the value of their investments or accounts. The bank also holds the B Corporation credential, which aims to put people and planet at the heart of its operations.

Australian banks offer their customers a range of competitive credit cards with no late fees.

Citi

Citi’s 200 years of experience in banking and financial asset management doesn’t translate into two centuries of credit card experience, but Citi’s credit card products have a solid reputation among credit card experts, especially for long APR introductory periods and strong returns.

Commonwealth Bank of Australia

Commonwealth Bank of Australia, commonly known as CBA or CommBank, is the largest of Australia’s four largest banks, serving more than 16.6 million customers. It offers a range of credit cards, including low-fee and Qantas Points options, as well as the Neo Card, which requires a simple monthly fee in exchange for 0% APR.

ing

ING Group is a multinational banking and financial services company headquartered in the Netherlands and its wholly-owned subsidiary ING Australia was established in 1999.

Currently, the bank only offers two types of credit cards: a low-interest rate option of a classic or platinum card, depending on the approved credit limit, and an Orange One Rewards card that offers cash-back rewards.

Macquarie Bank

Macquarie Bank, another of Australia’s largest banks with a growing market capitalisation surpassing some of the Big Four banks, could be named a key game changer that will create the “Big Five”.

With its growing market value and user base, Macquarie offers three different types of credit cards: Macquarie Black with Macquarie Rewards, Macquarie Platinum with Macquarie Rewards and Macquarie RateSaver Low Interest Rate Card.

National Bank

The ASX 200-listed NAB (National Australia Bank) has a market capitalisation of $96 billion as of January 2022. NAB serves 8.5 million customers in Australia and overseas and offers its customers eight different types of credit cards.

These include a standard product of no interest, low fees, low interest rates and rewards, as well as a credit card in partnership with Qantas that offers customers the airline’s Frequent Flyer Rewards points.

Suncorp Bank

Suncorp Bank offers its customers three credit card options: Standard, Gold and Platinum. While their purchase rates, interest-free periods and reward products vary, the cash advance rate for each Suncorp credit card is uniform at 21.99% per annum

Westpac

Westpac was Australia’s first bank, established in 1817 as the Bank of New South Wales. In 1982, the bank changed its name to Westpac Banking Corporation, which at the time of writing has 14 million customers worldwide.

Westpac is one of the big four banks and offers customers 10 different credit card options depending on individual requirements and qualifications.

credit union

Credit unions are member-owned financial institutions that, like banks, offer loans and offer checking and savings accounts. Unlike banks, credit unions return their profits to members. That means you’ll typically find lower loan rates and higher savings rates at credit unions, and potentially a friendlier banking experience. Many credit unions offer especially lucrative rewards credit cards. Those interested in greener or more sustainable banking may be interested in choosing a credit union over a larger bank.

Examples of credit unions that offer credit cards include:

  • Community First Credit Union
  • Holiday Coast Credit Union
  • Macquarie Credit Union
  • police credit union

small bank

Smaller banks or banks with regional footprints also often offer credit cards. Some examples include:

  • Heritage Bank
  • virgin money
  • ME Bank
  • our bank

How do credit card companies make money?

Credit card companies may profit from consumer transactions by charging consumers fees and interest charged on balances.

transaction fee

Every time you click, insert, swipe, or tap with your credit card, the merchant is charged a transaction fee to allow you to accept payments. This amount is usually included in the cost of the goods or services you purchase and is between 1% and 4%. Some suppliers pass this cost on directly to consumers. Either way, card networks make money from transaction fees charged directly to suppliers to facilitate accepting credit card payments and indirectly charge consumers through cost-plus markups.

interest

The interest rate associated with your use of the card (often called the Annual Percentage Rate (APR)) varies by lender and your creditworthiness, and is usually deducted from any balance on the card. Interest charges allow lenders to make a profit when you don’t pay your bills on time. To avoid interest charges, you can pay in full on time each billing cycle. A grace period (usually a billing cycle) will prevent interest from accruing.

annual fee

Credit card issuers may charge an annual fee for cards that offer premium rewards or that are advertised and designed for people with bad credit. Annual fees can be very expensive, especially for the highest-end, perks-packed rewards cards.

other fee

Card issuers can charge cardholders late fees for late payments, cash advance fees for using the card to withdraw cash from an ATM, balance transfer fees for transferring another card balance, foreign transaction fees or overage fees for purchases made outside Australia Fees when people spend more than their credit limit. All these fees allow credit card companies to profit from consumers’ financial needs.

bottom line

Many credit card options exist, but nearly all of them operate on one of three major networks: American Express, Mastercard, or Visa. Countless card issuers issue revolving credit accounts and borrow money from consumers in one form or another through a credit card. Generous rewards and loyalty programs may be part of many of these offerings that entice consumers to use credit cards, but credit cards also involve a lot of responsibilities. Note that late or missed payments, or holding balances for extended periods of time can be costly.

common problem

What are the Big Four credit card companies?

The four major credit card networks are Visa, Mastercard, American Express and Discover; however, Discover is not accepted in Australia.

The big four banking institutions in Australia are NAB, ANZ, Westpac and Commonwealth Bank.

Commonwealth Bank and Westpac both use the Mastercard network, while NAB and ANZ use Visa.

Can you get a credit card with bad credit debt?

How much credit card debt is there in Australia?

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