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Credit cards present a widely-accepted, convenient, fairly secure alternative to debit cards, cash and other forms of payment. Benefits including rewards, travel benefits and purchase protections make credit cards an even more appealing option for consumers—and this makes credit cards a big business.
Credit card companies are the credit unions, banks, payment networks and other financial institutions issuing credit to and facilitating card transactions for consumers and business owners. Card issuers are distinct from card networks, though some card networks are also card issuers. Let’s explore the differences.
What Are Credit Card Companies?
Credit card companies are classified as payment networks and/or card issuers.
Four major credit card networks dominate the market in Australia: American Express, Mastercard and Visa. Each credit card network—also called a card association—may work a little differently, but the basic principles remain similar.
Card networks work to facilitate the transfer of funds from a cardholder to a merchant. When you make a purchase using a credit card, payment processors use a card network to communicate transaction information between the merchant’s bank (also called the acquiring bank or acquirer) and the financial institution responsible for issuance of your card.
A credit card issuer is a bank or credit union providing a credit card directly to the end user, such as a consumer or small business owner. Major banks also often act as credit card issuers in Australia: Commonwealth Bank, Westpac, Macquarie, NAB and ANZ are all card issuers.
Credit Card Network vs. Credit Card Issuer
While credit card networks facilitate the transfer of information, credit card issuers offer credit cards to consumers and businesses. The card issuer is the institution determining who qualifies for the revolving line of credit, charging fees to the consumer and providing rewards. As a cardholder, you’ll primarily deal with your card issuer (not the card’s network) when taking actions such as paying your bill or reporting your card as missing.
If you want a Visa or Mastercard credit card, you’ll need to apply for one through another financial institution, such as Commonwealth Bank or Westpac. American Express is distinct among the 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 payment service providing customers with access to “products, insights and experiences that enrich lives and build business success.”
The company’s payment platform involves issuing cards and operating a payment network. Amex’s customers include consumers, small businesses, mid-sized companies and global corporations.
American Express cards are not exclusively issued by American Express, but many of the best Amex cards are.
ANZ
ANZ—the Australian & New Zealand Banking Group—is one of Australia’s ‘big four banks’, making it one of the nation’s largest financial institutions. ANZ provides banking and financial products and services to more than six million customers domestically, and around nine million worldwide.
As 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 had 10 separate cards available, including low interest rate cards and frequent flyer reward credit cards.
Bank Australia
Bank Australia is a customer-owned bank, meaning each of its customers is an equal shareholder, regardless of the value of their investments or accounts. The bank also has B Corporation credentials, with the intention to put both the people and the planet at the heart of its operations.
Bank Australia offers its customers a range of credit cards with competitive rates and no fees on late payments.
Citi
Citi’s 200 years of experience in banking and financial asset management doesn’t translate to two centuries of credit card experience, but Citi’s credit card offerings are renowned among credit card experts, especially for long introductory APR periods and great rewards.
Commonwealth Bank of Australia
Commonly known as CBA or CommBank, the Commonwealth Bank of Australia is the largest of Australia’s big four banks, offering services to more than 16.6 million customers. It offers a range of credit cards including low fee and Qantas point options, as well as a Neo card that requires a simple monthly fee in exchange for a 0% p.a. interest rate.
ING
ING Group is a multinational banking and financial services corporation headquartered in The Netherlands, with its wholly owned subsidiary ING Australia founded in 1999.
Currently the bank only offers two types of credit cards: a low-rate option in either a classic or platinum card depending on approved credit limit, and an Orange One Rewards Card which offers cash-back rewards.
Macquarie Bank
Macquarie Bank is another one of Australia’s largest banks, and with its increasing market cap eclipsing some of the big four banks, has been potentially named as the key change maker that will create ‘the big five’.
With its growing market cap and user base, Macquarie offers three different kinds of credit cards: Macquarie Black Card with Macquarie Rewards, Macquarie Platinum Card with Macquarie Rewards, and Macquarie RateSaver Card with Low Rate.
NAB
As of January 2022, the ASX 200 listed NAB—National Australia Bank—with a market capitalisation of $96 billion. NAB services 8.5 million customers both in Australia and overseas, and offers eight different kinds of credit cards to its customers.
These include the standard offerings of no-interest, low-fee, low-rate and rewards, as well as a credit card in partnership with Qantas to offer customers bonus Frequent Flyer points with the airline.
Suncorp Bank
Suncorp Bank offers its customers three credit card options: standard, gold, and platinum. While its purchase rates, interest-free periods and reward offerings all vary, each Suncorp credit card has a uniform cash advance rate of 21.99% p.a.
Westpac
Westpac was Australia’s first bank, established in 1817 as the Bank of New South Wales. In 1982, the bank rebranded to Westpac Banking Corporation and, at the time of writing, has 14 million customers worldwide.
Westpac is one of the big four banks, and offers its customers 10 different credit card options depending on individual requirements and qualifications.
Credit Unions
A credit union is a member-owned financial institution that, like a bank, makes loans and offers checking and savings accounts. Unlike a bank, a credit union returns its profits to members. This means you’ll generally find lower interest rates on loans and higher savings rates at credit unions—and also a potentially friendlier banking experience. Many credit unions offer particularly lucrative reward credit cards. Those interested in being more eco-friendly or banking more sustainably may be interested in choosing a credit union over a larger bank.
Examples of credit unions offering credit cards include:
- Community First Credit Union
- Holiday Coast Credit Union
- Macquarie Credit Union
- Police Credit Union
Smaller Banks
Smaller banks or those with regional footprints also often offer credit cards. Some examples include:
- Heritage Bank
- Virgin Money
- ME Bank
- Bank of Us
How Do Credit Card Companies Make Money?
Credit card companies might profit from consumer transactions, by charging fees to consumers and from interest charged on balances.
Transaction Fees
Every time you tap, insert, swipe or click with a credit card, a transaction fee is charged to the merchant for the convenience of accepting payment. This payment is often rolled into the cost of the goods or services you purchase and ranges between 1% and 4%. Some vendors pass this charge on to consumers directly. Either way, the card networks earn money by way of transaction fees charged directly to the vendor for the convenience of accepting the credit card payments and indirectly to the consumer via cost markup.
Interest
An interest rate—often noted as an annual percentage rate (APR)—associated with your use of a card will vary by lender and your creditworthiness and typically be charged to any balance carried on the card. Interest charges allow lenders to profit when you don’t pay your bill on time. To avoid interest charges, you can pay on time and in full every billing cycle. The grace period (typically one billing cycle) will prevent interest from accruing.
Annual Fees
Credit card issuers may charge annual fees on cards offering premium rewards or for cards advertised to and designed for those with bad credit. Annual fees can be extremely costly, especially for the highest-end, benefit-packed reward cards.
Other Fees and Charges
Card issuers can charge cardholders late fees for not paying on time, cash advance fees for withdrawing cash from an ATM with a card, balance transfer fees for moving the balance of another card, foreign transaction fees for purchases made outside of Australia or over-limit fees when a cardholder spends beyond a credit limit. All of these fees allow 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. Myriad card issuers issue revolving credit accounts and lend money to consumers via credit cards in one form or another. Lucrative reward and loyalty programs may be a part of many of these offerings to entice consumers to use credit cards, but credit cards also involve plenty of responsibility. Be aware that late or missed payments, or carrying a balance for an extended period of time can be costly.
Frequently Asked Questions (FAQs)
What are the four major credit card companies?
The four major credit card networks are Visa, Mastercard, American Express and Discover; however, Discover is not an accepted card in Australia.
The four major 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?
It is possible to get a credit card with bad credit debt in Australia, however it’s important to consider whether this is the appropriate option for your finances.
Some lenders will provide credit cards to Australians with bad credit scores depending on whether you’ve presented your personal finances to show you’re an ‘ideal’ applicant, but the process is much more difficult than it would be with a good credit history.
How much credit card debt is there in Australia?
The debt accruing interest on personal credit cards across Australia varies month-by-month as credit card holders pay off debts, cancel cards, and purchase new ones.
According to data from the RBA, the figure of credit card debt in Australia has hovered between the $16 billion and $20 billion mark for the past couple of years.
