Card scheme
Also known as: Payment card scheme, Card network, Card brand
A card scheme is the set of rules, standards and technical processes that lets cards issued by one bank work at merchants served by another. It licenses issuers and acquirers, sets the rules for every payment and charges scheme fees for running the network.
Last reviewed
Example
Illustrative scenario. A customer pays with a card from a French bank at a shop in Berlin. The scheme's rules and network are what make the German acquirer and the French issuer understand one another.
The logo on the card is the part everyone sees. The scheme behind it is the part that makes the card work.
The Interchange Fee Regulation defines a payment card scheme as "a single set of rules, practices, standards and/or implementation guidelines for the execution of card-based payment transactions". The scheme is the rulebook and the brand. It is not the bank that issues the card, and it is not the company that collects the merchant's money.
Most schemes in Europe are four-party schemes. The Regulation describes the flow as passing from the payer's account to the payee's account "through the intermediation of the scheme, an issuer (on the payer's side) and an acquirer (on the payee's side)". The scheme licenses the issuer and the acquirer, sets the rules and charges scheme fees. In a three-party scheme the scheme itself provides both issuing and acquiring. The Regulation adds that a three-party scheme which licenses other providers, or works through a co-brand partner or agent, is treated as a four-party scheme.
Schemes are international or domestic. The European Commission's 2020 review observed that scheme fees of the international schemes had risen to a limited extent, while domestic scheme fees remained low and stable. Cartes Bancaires describes itself as the most widely used card and mobile payment scheme in France, and Germany's girocard describes itself as the country's most widely used means of payment. Which scheme a customer's card runs on changes which fees apply.
How it shows up for a merchant: on the statement, as a card brand column, and often as the reason two cards at the same till cost different amounts.
What merchants get wrong is thinking the scheme sets the merchant's price. It sets its own fees and the rules. The interchange fee goes to the issuer, and the acquirer sets the margin.
The brand is on the card. The rules are in the contract.