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Costco USA goes to Visa
April 18, 2016
8:13 am
kanaka
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Interesting article. They don't have to apply for the new account. I wonder if Amex will re-issue a card to retain customers as they did here? And look at the cash back % and no fee!

The warehouse club officially switches over from American Express to Visa cards June 20. Shoppers will get new cards — called Costco Anywhere cards — in May and early June.

The days of the American Express Costco credit card are coming to an end.

American Express said last year its exclusive partnership with Costco would end in 2016.

Costco is partnering with Citigroup, and shoppers can expect to get their new Visa co-branded cards — called Costco Anywhere cards — in May and early June. The new cards double as membership cards.

June 20 marks the date the warehouse club officially switches over from American Express to the new Visa cards, Citigroup said.

Here are six things to know about the upcoming changeover:

What do customers need to do to make the switch?

Not much. Existing Costco members don’t need to apply for the new Costco Anywhere Visa card, which they will automatically receive in the mail. Members should keep using their American Express Costco cards through June 19 and then destroy them, Citigroup said. As of June 20 — when the new Visa cards start working — American Express Costco cards will be canceled and won’t work at any stores.

Citigroup said it will have more information for customers who are interested in becoming Costco members on applying for the card in June.

How do the rewards stack up?

Costco members can earn 4 percent cash back on up to $7,000 spent on gas, as well as 3 percent on restaurants and eligible travel, 2 percent on Costco purchases and 1 percent on everything else. The card doesn’t have an annual fee, but shoppers will need to pay for a $55 annual Costco membership.

The American Express cards provided 3 percent cash back on gas up to $4,000 per year, 2 percent on restaurants and eligible travel and 1 percent on other purchases.

That makes the Visa card a “no-brainer” for existing members, but also one of the better cash-back cards on the market that could be enticing for people who aren’t currently Costco shoppers, said Sean McQuay, credit-card expert for NerdWallet. McQuay worked for Visa while it was negotiating with Costco but said he wasn’t directly involved in the project.

According to McQuay, no card offers better cash-back rates on gas, restaurants and travel, but customers who see the biggest chunk of their credit-card bill going to groceries may get more cash back with a different card.

Why the increased perks?

Costco cardholders tend to be relatively affluent, use their credit cards frequently and make large purchases, making them desirable customers for a credit-card company, McQuay said.

“It’s safe to say Visa wanted to win this deal a lot,” he said.

Do customers need the new card to shop at Costco?

Costco members will be able to use any Visa card to shop at Costco after June 20 and don’t have to get the Costco Anywhere Visa card. However, only the Costco Anywhere card will offer the cash-back rewards described above.

Will getting a new card affect customers’ credit scores?

No — Citigroup said it will not pull a credit report when transferring customers’ accounts.

April 18, 2016
8:50 am
AltaRed
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FWIW, I would not have applied for a new Amex card myself except for the "Front of the Line" Ticketmaster privileges. I don't use the card for anything else. They may well cancel it on me eventually due to lack of use.

April 18, 2016
1:41 pm
Loonie
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Nice deal if you can get it.
I guess Cdn Costco members don't measure up in terms of "relatively affluent, use their credit cards frequently and make large purchases."

My other credit cards will continue to get my business and give me a better deal.

April 18, 2016
10:49 pm
Schrodinger's Ape
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Yeah, I got the Costco Mastercard when it came out, but regretted it the first time they automatically renewed my Costco membership on the card. I had intended to, oh I don't know, have some control over the use of my card? Crazy notion. I kept it around for convenience because I could keep one membership card in my purse and another in my school bag in case I went there after class. But the second year they renewed my membership, that was enough. I like to renew it in-store. I don't go in that often, so I can get an extra month out of next year's membership by waiting a little bit longer to renew it. Plus I hate CapitalOne. So cancelled it I did.

April 19, 2016
9:17 am
kanaka
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No longer will I follow Costco's change in credit cards if I already have. It is now an inconvenience as Canada and USA use different. We now use BNS MasterCard and they cannot auto bill to it....we now pay for membership at check out.

April 19, 2016
9:41 am
Loonie
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I think the excuse for autobilling may be that you are not allowed to have the credit card unless you are a member. So, postponing renewal would not be allowed. They would have to cancel the credit card and then you would have to start over.
I see little to no advantage in the card though. 3% for restaurants, and Costco gas pumps would be the only reasons I would consider it, but I haven't bothered.

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