With a market cap of nearly $500 billion, Mastercard (MA 1.15%) is a true corporate giant. Indeed, it ranks as the 16th-largest American company by market cap, ahead of other financial behemoths like Bank of America, Wells Fargo, American Express, and Morgan Stanley.
But why? And perhaps more importantly, will Mastercard retain its place in the years to come? Let’s find out.
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Mastercard’s greatest asset is its business model
Like its chief rival Visa, Mastercard has a business model based on payment processing. The company operates a vast network that facilitates payment transactions between merchants, cardholders, and card-issuing institutions.
In other words, Mastercard is the classic middleman. It charges fees for the use of its network. And while — broadly speaking — each individual fee is tiny, they really add…
