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Westpac ditches MasterCard

In an attempt to streamline the number of products it offers to customers, Westpac (ASX: WBC) customers will now be issued with Visa (NYSE: V) cards only – a change from the previous policy where new customers were given the choice between a Visa or Mastercard (NYSE: MA) credit card.

Whilst existing MasterCard card holders will be able to renew their cards without having to make the change, Rachel Slade, Westpac’s general manager of business improvements, said “in reality, customers don’t really need all that product” – referring to the 24 different credit cards and 300 products offered to customers by the bank.

Meanwhile, each of the other major banks still offer a choice between either Visa or MasterCard, although ANZ (ASX: ANZ) has a preferred relationship with Visa and Commonwealth Bank (ASX: CBA) prefers to issue customers with MasterCard credit cards.

Regarding the bank’s decision, Michael Ebstein, the head of credit card consulting firm MWE Consulting, said “at the end of the day, the thing that is most important for cardholders is that it is accepted where they want to use it. Whether it is Visa or MasterCard is really irrelevant, given the prices and the value-added services are determined more by the issuer than by Visa or MasterCard.”

Although the bank will no longer offer MasterCard credit cards for most of its products, the top of the range “Black” cards will still be issued as either MasterCard or American Express.

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Motley Fool contributor Ryan Newman does not own shares in any of the companies mentioned in this article.

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