How Visa Cards Work

By Tiara

Now that you have some understanding of credit cards, let’s take a look at how they work. The basics are the same for all VISA plastic so we will focus on those here!

A lot of things can be tough to understand when you first start using them, which is why there are often ‘how to use my card’ articles floating around online. It can get confusing trying to figure out what settings apply to certain situations, so it makes sense to have a general rule-based article.

In this article, I will go over some basic tips about how debit and credit cards work, and maybe even learn something new.

What is a debit card?

how visa cards work

A credit card is different from a regular old plain-old debit card because it has an additional feature called rewards. Companies offer reward cards that reward you for spending money at their store or business by giving you points, discounts, or both.

The more you spend at their location, the better your deal becomes. It’s subjective to what types of things people buy, but sometimes people purchase expensive coffee or snacks so that argument can be made.

By having these rewards, you are incentivized to keep spending money at their place! This helps promote continued business for them, helping them reap the benefits of offering the rewards program.

It also helps you stay motivated to spend since you get something back for it. An easy way to remember this is “I get what I give.” You have to earn extra perks by doing good things.

There are even times when someone will run out of cash and needs some help buying food, etc., in which case they’ll send you a VISA CARD as reimbursement. This is very common with students who may not have much income while attending school.

What are interest rates?

The term ‘interest rate’ is usually defined as the cost of credit (for example, a loan or line of credit) divided by the price of money (or finance).

But what does that mean?

In general, higher interest rates mean you have to pay more for a credit card so it can make it more expensive to spend! That’s not very helpful in theory, but in practice, there's another factor at play – how much each company charges its most valuable customers for spending.

The difference between the average purchase amount spent per month on a credit card and the average monthly fee paid for having the card makes up what we call the reward ratio. A lower reward ratio means bigger rewards for doing business with the same bank.

Usually, larger companies will offer discounts or promotions on their cards to win your business, which could include lower fees or even zero annual fees! Check out our list here to see who offers the best balance of perks without high yearly fees.

What are rewards programs?

how visa cards work

Reward programs are an increasingly popular way to win over customers. Companies offer discounts or reward points that can be exchanged for merchandise or gift cards.

Many major companies use reward programs as a marketing tactic to draw in new shoppers. Retailers offer VISA gift cards, Amazon Prime memberships, and discount vouchers through their rewards program.

By offering frequent buyers more ways to save money, they’re incentivizing the purchase of their product or service. It’s a powerful sales technique!

Rewards program participants receive “points” for shopping at approved vendors and then they combine their points with those of other people to redeem products or get credit towards charity donations.

There are several well-known rewards programs such as Chase Ultimate Rewards which give you back 1% more when you spend using either card. This is called Transferable Value (TV). Your TV doesn’t work like airline miles where you earn one point per dollar spent, it’s proportionally higher depending on what kind of item you buy.

This article will go into detail about another common type of rewards program – cash back. These are usually pre-selected spending accounts or categories in which the issuer pays 0% interest on purchases made within that category for a set amount of time.

The longer the term, the better the deal since there is no interest paid while the money is sitting in the account.

How can I get a credit card?

how visa cards work

Having a good credit history is one of the most important things in getting approved for a new credit card. Even if you have bad credit, there are ways to improve your score enough to qualify for a loan that doesn’t require credit.

Most major credit cards offer some kind of cashback or reward program where you earn points towards rewards or refunds for buying products from their network.

Some don’t even ask about how much money you make – only questions like “what type of business do you own?” and “how many people work at this job?”

And while they may not ever come after your savings account or house, it is possible to be denied a credit card because you don’t have enough money saved. Some banks will reject you due to a lack of income or inability to repay debts.

How can I get a debit card?

how visa cards work

If you are an experienced shopping or spending traveller, then you already have a credit card! You probably also know how cards work, at least slightly. But for newer travellers or those that do not spend as much money, getting your credit card can be tricky.

Luckily, there is another way to access money quickly online! A prepaid visa gift card is similar to having a credit card, but it does not require a monthly fee. These cards may even give you more buying power than a traditional credit card!

Many companies offer reward program cards, which are usually sponsored by business locations or hotels. By adding these rewards to your account, you will start earning points towards free travel or merchandise!

Some of the most common ways to use a prepaid card include:

Making purchases online

Transferring funds via phone or app

Accessing directly from the bank account

This article will discuss some things related to visa gift cards, including how to get one, costs, expiration dates, and additional tips.

Can I get a credit card without a good credit history?

how visa cards work

It is not easy to prove creditworthiness when you do not have a record of credit use. This means that even if your potential lender reviews recent pay stubs, receipts, and chat conversations with coworkers, they may be unable to determine whether you can afford to spend money right now or not.

Fortunately for you though, there are ways to obtain credit even if you have no credit whatsoever! There are many different types of credit cards available to individuals who might not otherwise qualify due to a lack of credit.

Most lenders will evaluate how you behave about credit already obtained before issuing you more credit. For example, people with poor payment histories often start by paying their new debt immediately after it comes up, which helps establish an account balance owed that is less than what was spent.

What are the different credit card companies?

how visa cards work

In this article, we’ll take a closer look at some of the major players in the credit card industry and what each one offers you as a customer. Some will feel like they are “better than others!”

That is not always the case, however.

All big-name credit cards work much the same way. Each one allows you to make purchases online or through their mobile app by adding money to your account via direct deposit, debit card, check writing, etc.

What sets them apart is how easy it is to access those funds and what services and rewards they offer to customers. For example, some let you earn points towards gift cards for shopping at stores, while others reward you with cash-back checks.

Some even have monthly loyalty rewards that increase as you spend more frequently. This helps you keep spending within budget because you get an incentive every time you shop!

It is important to do your research before choosing which type of credit card to carry around, so you know what features matter most to you.

What are the different types of credit cards?

how visa cards work

Credit card numbers are pretty long, what with all those random digits that we, as consumers, never use. But most major credit card companies do not use every digit in the number for something important.

The first two or three characters of your credit card number determine which type of card it is. These two to three characters are called the “card designator” or “serial number.” The rest of the number is just filler information.

For example, let’s say my name was Isabella and I wanted to get a very expensive item from So, I go online and search for “best vacuum bags for Amazon Prime.” Then I click on the one-year warranty offered by and add it to my cart.

My credit card is linked to my Amazon account, so when I check out, my bank will automatically transfer the appropriate amount to their system, along with the confirmation of the purchase.

Now, what if I want to buy this same product but from another website? Let’s say I find the same vacuum bag deal at When I run my payment through their site, they won’t accept my card because there’s no match between the vacuum bag and my account.