What is a credit card issuer?

Ever wondered what a credit card issuer is, what they charge and how they work? Here’s what you should know about credit card issuers in the UK.

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It’s important to know who your credit card issuer is because you can’t usually get more than one credit card with the same issuing bank.

Here we take a look at everything you need to know about credit card issuers and answer common questions you may have about your provider.

What is a credit card issuer?

A credit card issuer is a bank or financial institution that offers credit cards to customers. So, it’s the institution you actually get your credit card from.

You enter into a credit agreement with the card issuer, and you make your monthly repayments to them. They set your credit limit and decide whether to adjust your limit at any point.

Examples of credit card issuers

In the UK, common credit card issuers include:

  • HSBC
  • Santander
  • Virgin Money
  • Bank of Scotland
  • Barclaycard
  • Vanquis Bank

How do credit card issuers work?

A credit card issuer is responsible for reviewing and approving your credit card application, activating your credit card, issuing statements, processing your monthly payments and reporting any problems to credit bureaus. The credit card issuer also sets your credit limit, interest rate and any credit card charges.

Credit card issuers charge interest to cover the cost of their own borrowing, the cost of chasing any loan defaults and also to provide the company with a profit.

Are credit card issuers and payment processors the same?

Credit card issuers and payment processors aren’t the same. The credit card issuer is the company or bank that gives you the card. In contrast, the processor handles or processes the transactions you make using the card. Familiar payment processors include MasterCard and Visa.

So, for example, if you have a Virgin Money credit card, your card will have both Virgin Money and MasterCard logos on the front. Virgin Money is the card issuer, but MasterCard is the payment processor.

American Express is an exception to this rule. The company issues and processes its own cards. So, if you take out an American Express credit card, the company is usually also your payment processor.

How do credit card issuers differ from co-branded partners?

A co-branded credit card is where a retailer or service provider issues a credit card in partnership with a credit card issuer. If you have a co-branded credit card, it’s likely to have the logos of the retailer, the card issuer and the payment processor on the front. These co-branded cards often offer loyalty points or other rewards to encourage you to shop with the retailer.

For example, Amazon’s Mastercard is actually issued in partnership with Newday. Although the card is branded with the Amazon logo, Newday is the card issuer and processes credit card applications. The payment processor is Mastercard. Amazon’s credit card offers points for Amazon spending on your card, which you can build up to receive Amazon vouchers.

How do you check who issued my credit card?

It’s easy to check your issuer. Here are some things to look for:

  • Does your credit card come from a bank, like NatWest or Santander? If a bank issued your card, then the bank is your credit card issuer.
  • Do you have a credit card from a store like John Lewis? You’ll need to find out who the partner bank is because they issue the card. For example, John Lewis Partnership cards are provided by HSBC, so HSBC is actually the issuer and owns your card.
  • Do you have your card agreement handy? You’ll find details of the card issuer in the contract.

Does it matter who issued your card? Yes, and here’s why:

  • If you have a balance transfer credit card, you can’t normally transfer the balance to a new card from the same bank.
  • Some banks only offer people one credit card from their range at a time. So, if you need a second card, you’ll probably need to find one provided by a different issuer.

What are typical credit card issuer fees?

Credit card interest rates vary significantly depending on your credit score and your financial situation. How much you pay to use your card depends on a range of factors, including your:

  • Credit score
  • Outstanding balance
  • Credit limit
  • Repayment history

Some cards come with an annual fee, too, so bear this in mind when you’re shopping for a card.

How can you find the lowest credit card issuer fees?

If you want to keep your credit card issuer fees as low as possible, then here are some tips:

  • Shop around for a card offering a competitive interest rate. Don’t just apply for the first card you find.
  • Pay your bill on time. Otherwise, you’ll probably face late payment fees.
  • Keep the interest down by paying off your outstanding balance in full each month. Or, at least pay off as much as you can.

If you’re trying to find the right credit card issuer for you, check out our top-rated credit cards in the UK today.