MasterCard doesn’t make money directly from consumers using their cards. Instead, they generate revenue through several key channels:

1. Assessments: This is the main source of income, accounting for roughly 28% of Mastercard’s revenue. Assessment fees are charged to financial institutions that issue Mastercard-branded cards based on the gross dollar volume (GDV) of transactions made using those cards. The higher the GDV, the higher the fee.

2. Transaction fees: This accounts for about 34% of their revenue. These are small fees charged to merchants every time a Mastercard is used for a purchase. This fee is typically a percentage of the transaction amount and a fixed fee.

3. Cross-border fees: When a Mastercard is used in a different country than the one where it was issued, additional fees are charged, contributing around 23% of Mastercard’s revenue. These fees cover currency conversion and other costs associated with cross-border transactions.

4. Other revenue: This includes smaller sources of income like data analytics services, consulting fees, and licensing fees for Mastercard technology.