Module 2: Card Networks Deep Dive - Visa, Mastercard, Amex, Discover

What do Visa and Mastercard actually do?

If you think Visa processes payments, you have the wrong mental model of how the card industry works. Visa, Mastercard, American Express, and Discover are not processors and not issuers. They are network operators that set the rules, run the switching infrastructure, and collect fees from the participants who plug into them. This module is the structural deep dive on the four networks: how they are organized, how they make money, where they compete, and why the structural differences between them shape everything from interchange rates to fintech opportunity.

What you'll learn in this module

• Why the four-party model exists for Visa and Mastercard and the three-party model exists for Amex and Discover, and what that difference means for fees
• How interchange is set, who actually receives it, and why merchants and regulators keep trying to force it down
• The economics of network assessments, scheme fees, and the cross-border fee stack that most merchants never see itemized
• Where each network is strong (consumer, corporate, premium, debit, international) and where each is structurally vulnerable
• How fintech and account-to-account rails change the leverage between issuers, acquirers, and the networks

By the end of the module you will be able to read any payments deal, regulatory filing, or fintech pitch deck and immediately place each participant in the right structural position relative to the networks.