Those big changes at Costco: What you need to know
June 20 -- Jud Linville, global cards chief executive officer at Citigroup, discusses the partnership between Citigroup and Costco and the release of new credit cards available exclusively to Costco members. Bloomberg
A shopper leaves a Costco store in Portland, Ore. Costco shoppers who have been limited for years to American Express credit cards may be able to pluck a new option from their wallets or purses next year when an exclusivity deal between the two companies expires on March 31, 2016.(Photo: 2011 photo by Rick Bowmer, AP)
Costco switched credit card providers to Citi Visa[1] on Monday, ending its 16-year relationship with American Express, creating some big changes for many among the wholesale club's 81.3 million members.
Now, Costco's TrueEarnings American Express can no longer be used. Instead, Costco is mailing out new Citi Visa cards, officially called the Costco Anywhere Visa Card by Citi. The changeover was automatic, with no credit checks required, Costco says. Also, all of its members' cash-back credits are being transferred to the new card accounts.
Citi began the process of mailing out new cards late last month. Here are some other key facts about the new card:
• Is there an annual fee for the new Visa card?
Costco includes the cost for the card as part of your annual $55 Costco membership, so there is no additional fee to get the new card and no annual fee to use it beyond your Costco membership.
• Will other credit cards — such as from American Express, Discover or MasterCard — work at Costco?
Visa is taking over as the exclusive credit card for Costco, which means all other non-Visa credit cards will no longer work.
That said, you do not need to use the Costco-branded Visa card. Other Visa cards will be accepted. You can also still pay with cash, checks, debit cards, Electronic Benefit Transfer (EBT) and Costco Cash Cards.
• Is the new Costco Visa card also my membership card?
The Costco Visa card also doubles as a membership card. If you don’t have a Costco Visa card, you can still use your non-credit card Costco identification card.
• What are the benefits for this new Visa card? Costco says its switch to Visa offers greater benefits compared to what was available from American Express.
You’ll get 4% cash back on eligible gasoline purchases, including gas at Costco, for the first $7,000 in purchases a per year. After crossing the threshhold, you'll get 1% cash back. That's an increase from 3% back on the first $4,000 under the Amex Costco card.
Restaurant and eligible travel purchases worldwide also get a bump. You'll get 3% back on the new card compared to 2% on the old card. Purchases from Costco and Costco.com will now also get you 2% cash, compared to 1% before.
All this said, there are some disadvantages that come with the new card. For instance, the new card will not offer a roadside assistance hotline. You also have to redeem your cash-back rewards at Costco.
Follow Eli Blumenthal on Twitter @eliblumenthal[2]
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References
- ^ switched credit card providers to Citi Visa (rssfeeds.usatoday.com)
- ^ @eliblumenthal (twitter.com)