Most credit card systems in Switzerland are organized as a four-party system.

This means that the card issuers and the card service providers (acquirers), in their role as independent companies, connect their customers (cardholders and merchants) to the credit card network. Both the issuer and the acquirer need a license for this.

Every day, billions of consumers around the world pay for goods and services with their credit cards in over 160 different currencies at more than 100 million acceptance points. Credit card organizations play a very important role here.

In Switzerland, Mastercard and Visa are probably the best-known and most widely accepted credit card organizations. They are essentially the link between card issuers and merchants and ensure that the business receives its money. You can use Visa and Mastercard credit cards at most Swiss merchants that accept cashless payments.

The four-party system is relatively complex and has clear rules. Various measures are also integrated into the system’s payment process to ensure the security of a credit card payment. In addition to entering your PIN code, authentication (such as identity check / 3-D Secure / CVC security code) is an effective security measure. Last but not least, the systemic risk is also spread, especially since several actors are involved and not just one.

The security of prepaid cards is also high because in the event of misuse, your risk is limited to the available balance. However, provided you have complied with the due diligence obligations and reported the discrepancies within the specified period through the official channel, you will be refunded the amount. No wonder they are popular with consumers – by 2025, over three million cards are in use.

At the bakery, the shopping center, the bratwurst stand, the luxury boutique or the circus ticket office – with your credit, prepaid or debit card you can make cashless purchases almost anywhere.

Hold the credit card to the reader, enter the PIN code (depending on the amount), press “OK” and your purchase is completed in just a few seconds. While cashless payment is as simple and trouble-free as possible for you, a lot goes on behind the scenes at the credit card organizations.

1. Payment transaction

Imagine you are shopping at the local store. At the checkout, you make a contactless payment with your card – physically or via your digital wallet – or use the card reader to complete the payment process.

2. Payment processing

The terminal in the store transmits the transaction request to the card service provider (acquirer) with whom the store has its credit card contract.

3. Credit card verification

The request goes from the acquirer to the card issuer. �۶���Ƶ is also an issuer in Switzerland. In this role, �۶���Ƶ issues your credit card, makes the relevant amount of credit available and enables you to access the card system. Card issuers also check whether your card is blocked and whether the transaction amount would exceed your credit card limit.

4. Transaction feedback

If everything is in order, this information is sent back to the card service provider.

5. Payment confirmation

From there, the “OK” is forwarded to the merchant’s payment terminal. Next, the amount is paid and your receipt is printed upon request. This entire process is completed within a few seconds.

6. Transaction posting

The amount is immediately reserved, and the card issuer posts the amount to your credit card account with a slight delay. This ensures that the transaction is visible online as soon as possible.

If you pay off the amount by the deadline, you will benefit from an interest-free loan when shopping with your credit card. Nevertheless, every credit card purchase generates costs within the four-party system.

Your costs as a cardholder

Depending on the card issuer (e.g. �۶���Ƶ), you pay an annual fee. This varies from issuer to issuer.
Transaction-related costs are: surcharges for foreign currency transactions, fees for cash withdrawals, fees for paper card statements or interest on invoice amounts that you have paid in multiple installments or that are overdue. The costs depend on the payment card. For example, with the �۶���Ƶ Classic Credit Card, in combination with the �۶���Ƶ me banking package, the annual fee is waived.

Merchants

The merchant (in the aforementioned example, your local store) pays a merchant commission per transaction. This is usually a percentage or tenth of a percentage of the transaction amount. These commissions are charged for prepaid and debit cards, as well as credit cards.

Card issuers

The merchant fee consists of the interchange fee and a service fee. The interchange fee is received by the card issuers, the service fee by the acquirers.

The interchange fee is a necessary financial compensation mechanism in the four-party system of the credit card network. It enables an appropriate cost/benefit split between all the parties involved in the credit card system (cardholders, issuers, acquirers, merchants).