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Do you know the difference between a credit card issuer and a credit card payment network?

Both companies claim a spot on the front of your credit card — but they're entirely different things.

A credit card issuer is a bank or credit union that extends credit to you for your everyday spending. A payment network does the job of transferring money from your card to the merchant with which you're paying. In other words:

  • The bank issues you a credit card, allowing you to borrow a certain amount of money for whatever you like
  • The payment network transfers the money from your card to the store you're at when you buy goods
  • You transfer money from your bank account to the credit card issuer to repay them for the money they lent you

There are four major payment networks used by the US (and certainly there are several others used internationally): American Express, Discover, Mastercard, and Visa. All are accepted at tens of millions of locations around the world — although some, like American Express, aren't as widely accepted in certain regions.

Let's look at the most popular credit card issuers in the US, all of which use one of the above four payment networks. We'll examine their general personalities and touch on application restrictions, too.

We're focused here on the rewards and perks that come with each card. These cards won't be worth it if you're paying interest or late fees. When using a credit card, it's important to pay your balance in full each month, make payments on time, and only spend what you can afford to pay.

Lis of major credit card companies

American Express

American Express is both a credit card issuer and a payment network. Yes, it offers its own cards as well as co-branded credit cards from popular travel partners such as the Delta SkyMiles® Reserve American Express Card - Product Name Only and the Marriott Bonvoy Brilliant® American Express® Card - Product Name Only. But other card issuers use Amex's payment network, as well — such as the U.S. Bank FlexPerks® Gold American Express® Card - Product Name Only (not issued by Amex but by U.S. Bank).

The company is also known for issuing cards that don't have a firm credit line — something other banks have tried in the past and mostly abandoned. Examples of such cards include The Platinum Card® from American Express - Product Name Only and the American Express® Gold Card - Product Name Only. These were once called "charge" cards, which allowed cardholders generous (unspoken) spending parameters but demanded that the full balance be paid each month. Amex has since implemented a feature on these cards called "Pay It Plan It" which effectively makes these cards act like regular credit cards.

While Amex offers a card for just about any goal and budget, its focus is on premium credit cards that earn travel rewards, many of which have lofty annual fees. These cards can be well worth the price tag, though; Amex Membership Rewards points, the issuer's rewards currency, are some of the most valuable points you can collect — and you can transfer them to Amex's airline and hotel partners for free flights and hotels.

Read Insider's guide to the best American Express cards to see how immensely valuable these cards can be.

Notable credit card application rules: American Express has a strict application rule that prohibits you from earning a welcome bonus on a specific card more than once per lifetime. For example, if you've previously earned a bonus on the Blue Cash Preferred® Card from American Express - Product Name Only, you can't ever get it again (unless Amex specifically targets you for another offer).

Amex considers "credit cards" to be any cards with either a firm credit limit or those enrolled in "Pay It Plan It." The bank enforces a limit of five credit cards per account. Also, you can only be approved for two credit cards every 90 days.

Bank of America

Generally speaking, Bank of America's target audience is more the average cardholder who prefers easy-to-use rewards without paying a large annual fee. Most of the products they offer are no-annual-fee credit cards that accrue either cash back or other rewards that can be redeemed for a flat rate, such as the Bank of America® Customized Cash Rewards Credit Card - Product Name Only and the Bank of America® Travel Rewards credit card - Product Name Only.

However, the company also issues some of the best airline credit cards in the game — namely, the Alaska Airlines Visa® Credit Card - Product Name Only and the Alaska Airlines Business Credit Card - Product Name Only. The miles these cards collect are the single most valuable airline rewards currency in existence, per Insider's points and miles valuations.

In addition, many (non-cobranded) credit cards get a major rewards boost for cardholders that participate in the "Bank of America Preferred Rewards loyalty program, which bonuses your earnings depending on which status tier you hold:

  • Gold: Earn 25% more rewards on purchases (must have a minimum of $20,000 on deposit in eligible Bank of America/Merrill accounts)
  • Platinum: Earn 50% more rewards on purchases (must have a minimum of $50,000 on deposit)
  • Platinum Honors: Earns 75% more rewards on purchases (a minimum of $100,000 on deposit)

This can catapult the earning rate of the best Bank of America credit cards above just about anything else on the market.

Notable credit card application rules: Bank of America tends to allow you to open no more than:

  • Two credit cards within two months
  • Three credit cards within 12 months
  • Four credit cards within 24 months

Additionally, you'll find that you can't open a card if you've held it within the past 24 months. If you've canceled a card that you've since decided that you miss, you won't be able to get it unless it's been at least two years.

Barclays

Barclays Bank is a British universal bank. It lives in the UK, but it issues a large number of US credit cards, such as the JetBlue Plus Card - Product Name Only, AAdvantage® Aviator® Red World Elite Mastercard® - Product Name Only, and the Wyndham Rewards® Earner Plus Card - Product Name Only

The bank also issues a handful of co-branded store credit cards from merchants such as Banana Republic, GAP, and Barnes&Noble.

Barclays credit cards tend to come with extremely low minimum spending requirements to unlock generous bonuses (almost never over $2,000 in purchases). For example, the AAdvantage® Aviator® Red World Elite Mastercard® - Product Name Only offers AAdvantage® Aviator® Red World Elite Mastercard® - Intro Bonus.

As a point of reference, the CitiBusiness® / AAdvantage® Platinum Select® Mastercard® - Product Name Only comes with CitiBusiness® / AAdvantage® Platinum Select® Mastercard® - Intro Bonus. That's a similarly sized welcome bonus but with a much more difficult spending requirement.

Notable credit card application rules: Data points suggest that Barclays is very hesitant to approve you for a credit card if you aren't routinely spending on your current Barclays card. It wants to know that the cards it extends to you will truly play a role in your spending habits (instead of perhaps only opening a credit card for the welcome bonuses).

Capital One 

Capital One credit cards have become some of the hottest products of late, offering what are largely considered some of the best rewards credit cards in the most popular categories, such as cash back, travel rewards, secured credit cards, and student credit cards.

As an example, the Capital One SavorOne Student Cash Rewards Credit Card - Product Name Only offers up to 10% cash back on certain purchases and benefits like a free Uber One membership (otherwise $9.99 per month) through November 14, 2024 — and you don't even need a high credit score to open it.

Capital One does not partner with any airlines, hotels, or other travel companies to co-brand credit cards like most other card issuers. However, they have still cultivated relationships that allow those who earn Capital One miles (the bank's proprietary travel currency) to convert rewards into airline miles and hotel points with Capital One partners such as Air Canada Aeroplan, Wyndham, and British Airways.

Cards that earn Capital One miles include the Capital One Venture X Rewards Credit Card - Product Name Only and Capital One Venture Rewards Credit Card - Product Name Only.

Notable credit card application rules: You can only have two personal Capital One-branded credit cards at once (e.g. the Capital One VentureOne Rewards Credit Card - Product Name Only and the Capital One Venture X Rewards Credit Card - Product Name Only.

You can be approved for one card per six-month period. An overwhelming number of personal reports in online forums suggest Capital One can be rather picky about approving folks for cards, even those with an excellent credit score.

Chase

Chase offers some of the best credit cards in existence — and steadily continues to release new products. In the past couple of years, Chase has added cards like the Aeroplan® Credit Card - Product Name Only, World of Hyatt Business Credit Card - Product Name Only, and United Quest℠ Card - Product Name Only — all of which are uniquely valuable.

Similar to American Express, the bank has worked hard to create an extremely valuable rewards system (Chase Ultimate Rewards®) and airline and hotel partners such as Hyatt, United Airlines, Southwest, and more. But it also offers a vast catalog of co-branded credit cards, such as the Marriott Bonvoy Boundless® Credit Card - Product Name Only, Southwest Rapid Rewards® Priority Credit Card - Product Name Only, and IHG® Rewards Premier Credit Card - Product Name Only.

Chase issues a handful of exceptional credit cards that it markets as cash-back credit cards (such as the Chase Freedom Flex℠ - Product Name Only ). In reality, these cards earn Chase Ultimate Rewards points. If you've got an annual fee-incurring card Ultimate Rewards card such as the Chase Sapphire Preferred® Card - Product Name Only, you can convert the rewards you earn with many of its other cards into airline miles and hotel points.

Read Insider's guide to the best Chase cards for more information.

Notable credit card application rules: Chase will not approve you for the vast majority of its credit cards if you've already opened five or more credit cards, even if they're issued by other banks, in the last 24 months (this is commonly known as the Chase 5/24 rule). The only exception is most small business cards, which do not appear on your personal credit report. You'll also generally be approved for no more than two personal cards and one business credit card every 30 days.

In some cases, Chase personal cardholders cannot open another personal credit card that earns the same type of points as the card they've already got. For example, Southwest Rapid Rewards® Plus Credit Card - Product Name Only cardmembers cannot open a Southwest Rapid Rewards® Priority Credit Card - Product Name Only unless they cancel their current Southwest card (and on a related note, will not be able to earn a Southwest bonus until 24 months after earning the previous Southwest bonus).

Also be aware that each card's bonus will be available to you again after either 24 or 48 months, depending on the card.

Citi

In recent years, Citi has created some of the best credit cards for customers looking for perks like cash back or a generous 0% intro APR.

For example, the Citi® Diamond Preferred® Card - Product Name Only comes with Citi® Diamond Preferred® Card - Intro APR (then a Citi® Diamond Preferred® Card - Regular APR APR). That's one of the most generous 0% APR windows you can get.

Citi is also a major player in the travel rewards space. It co-brands a handful of travel credit cards, such as the Citi® / AAdvantage® Executive World Elite Mastercard® - Product Name Only and Citi® / AAdvantage® Platinum Select® World Elite Mastercard® - Product Name Only. It also issues its own rewards currency, Citi ThankYou points, which you can transfer to Citi's airline and hotel partners such as JetBlue, Choice Hotels, and Turkish Airlines when you have the right cards.

Similar to Chase and Capital One, you can transfer the rewards you earn with many of its cash-back cards if you've also got a ThankYou points card that charges an annual fee — either the Citi Premier® Card - Product Name Only or the Citi Prestige® Card - Product Name Only (not available to new applicants).

Unfortunately, Citi credit cards are almost never crowned the best travel rewards credit card in any genre. That's because Citi has axed nearly all travel insurance, making them the riskiest form of payment when buying airfare, rental cars, etc. Paradoxically, the only cards that offer travel insurance are not travel credit cards. The Costco Anywhere Visa® Card by Citi - Product Name Only and Costco Anywhere Visa® Business Card by Citi - Product Name Only come with things like rental car insurance and travel accident insurance.

Insider's guide to the best Citi credit cards will help you to decide which Citi card is best for you.

Notable credit card application rules: Citi allows you to open no more than one credit card per eight days and no more than two cards per 65 days.

In many cases, Citi enforces restrictions on credit cards in the same "family." Generally speaking, you can't earn a welcome bonus on a credit card that earns the same type of travel rewards as one that you've already got until a specified amount of time has passed.

As an example, if you open the Citi Rewards+® Card - Product Name Only (which earns Citi ThankYou points), you can't earn the bonus on the Citi Premier® Card - Product Name Only until 24 months after you've either earned the bonus on or closed the Citi Rewards+® Card - Product Name Only. This includes earning the same bonus more than once.

Discover

Similar to American Express, Discover is both a credit card issuer and a payment network. Just a few years ago, Discover was far behind the likes of Visa and Mastercard in terms of accepted locations, but it has since muscled its way into the competition.

Discover does not charge an annual fee for any of its credit cards. Its rewards are easy to use (you'll always get a flat 1 cent per point when redeeming for a statement credit), and some of its products have an exceptional return rate. For example, the Discover it® Cash Back - Product Name Only earns bonus cash back on rotating bonus categories Discover It Cashback rotation.

Discover also offers a unique welcome bonus structure with its cards that you won't find from any other issuer. Discover will match all the cash back you earn during your first 12 months of cardmembership — meaning the Discover it® Cash Back - Product Name Only will earn effectively 10% with its rotating bonus categories and 2% on all other purchases.

If you don't like the idea of a complicated rewards system (despite the enormous value proposition), a Discover card may be perfect for you. Read Insider's guide to the best Discover credit cards.

Notable credit card application rules: You can't have more than two credit cards issued by Discover at once — and if you want to be approved for the second, you must be a cardholder for at least one year.

Synchrony

Synchrony is best known for its manifold store credit cards. The bank issues well over 100 cards, in fact. Most famous are cards like Amazon's Prime Store card - Product Name Only and the Lowe's Advantage Card - Product Name Only, both of which provide benefits like 5% back and special financing on select purchases.

One thing to be aware of with store cards — particularly those issued by Synchrony — is that they aren't always "open loop." In other words, they can't be used just anywhere. If your card doesn't have a payment network on the front (Visa, Mastercard, American Express, etc.), you'll only be able to use the card for purchases at whatever store name is on the front.

Synchrony cards can make sense for some, but they notoriously lack welcome bonuses and meaningful benefits outside a handful of merchant-specific perks.

U.S. Bank

U.S. Bank primarily issues cash-back credit cards (and stellar ones, at that), but it flirts with travel rewards, as well. Both currencies effectively work the same: You can redeem your earnings for a flat rate.

For example, the points you earn from a card like the U.S. Bank Altitude® Reserve Visa Infinite® Card - Product Name Only cannot be transferred to airline or hotel partners like the rewards you'll get from other banks like Chase and Amex. Instead, you can redeem them for:

  • 1.5 cents each toward travel purchases via Real-Time Mobile Rewards
  • 1 cent each for cash and gift cards
  • 1 cent each (or slightly less) for merchandise

U.S. Bank doesn't offer complex rewards redemption options, making its cards perfect gateways into credit card rewards. It also issues a selection of secured credit cards as well as cards that offer 0% intro APR, making it a good bank for those who are trying to build (or rebuild) credit, as well as those trying to alleviate debt payments.

Wells Fargo

Wells Fargo doesn't issue many credit cards, but it still manages to cater to just about everyone. It's got cards that specialize in cash back, 0% intro APR, and even transferable points.

Most notable is the Bilt Mastercard® - Product Name Only, which allows you to pay rent with a credit card and not be charged exorbitant service fees. The points you'll earn can be transferred to perhaps the most valuable collection of transfer partners offered by any bank; you can transfer to American Airlines, Hyatt, United Airlines, Turkish Airlines, and more.

Another notable thing about Wells Fargo cards is all personal cards offer generous cell phone insurance — even with no annual fee. You'll get up to $600 in coverage per claim with just a $25 deductible (limit of $1,200 in coverage per 12 months). The only requirement is that you pay your monthly phone bill with the card, and you'll automatically be covered.

Read Insider's guide to the best Wells Fargo credit cards for more information.

Credit card application rules: Wells Fargo states that you could be denied a new credit card if you've already opened a Wells Fargo card in the last six months.

Other credit card issuers

There are many, many other credit card issuers than just the main players above. From banks that cover just a few states to a credit union with less than 40 locations to virtual credit card companies that don't have a single brick-and-mortar option, the issuers seem nearly endless.

Here are the next most popular banks and credit unions to choose from.

National/regional banks

Read Insider's guide to the best national banks.

Online banks

Read Insider's guide to the best online banks.

Credit unions

Read Insider's guide to the best credit unions.

What to know about credit card companies

There are several dozen credit card issuers to choose from, but a select few dominate the market:

  • American Express
  • Bank of America
  • Barclays
  • Capital One
  • Chase
  • Citi
  • Discover
  • Synchrony
  • U.S. Bank
  • Wells Fargo

If you're looking for one of the best rewards credit cards to help you quickly earn cash back or travel points, it'll almost certainly be with one of these banks. Just be aware of each bank's application rules as you peruse each issuer's various options. 

Read the original article on Business Insider