Facebook Twitter

Costco begins new credit card agreement

SHARE Costco begins new credit card agreement

After its multi-year business arrangement with American Express came to an end, Costco Wholesale stores and gas stations officially began accepting Visa on Monday.

That's big news for customers who liked buying everything from paper towels to soda pop in bulk, but were forced to do so using cash, debit or their American Express credit card. Costco and American Express held an exclusive agreement — despite it being strange for retail stores to accept only one form of credit card payment — for more than 15 years until the two surprisingly announced in February 2015 they would part ways.

Months thereafter, Costco entered into an agreement with Visa.

According to Costco Wholesale, customers should have received by mail a Costco Anywhere Visa Card by Citi to replace their Costco American Express. Those who have not received their cards are encouraged to contact Citi.

"They (Costco) sent my replacement card and, so far, everything has been pretty smooth," said James Vinatapat of San Diego. "Although I haven't gone online to activate my account yet, so I guess it's a little too early to tell (how well it worked)."

Customer accounts, including all rewards points and bills, will transfer from their American Express Card to the Anywhere Visa Card. However, it is necessary to go online to activate the account.

The switch has had a mixed reception among Costco shoppers.

"If I had a choice, I like my American Express better," said Dana Baur, a resident of Pleasant View. "We were notified a few months ago and I called them. They said they were changing over to Visa."

Baur said she likes purchasing gas at the location in South Ogden and goes to the store at least a couple times a month.

Candice Barnhoorn, of Indio, California, also said she shops at Costco frequently and was initially concerned about the switch.

"We heard it can cause a bit of a ding on your credit score," Barnhoorn said. "But for the most part it went pretty smoothly."

Although the Costco American Express will no longer work, Costco customers will be able to use any Visa card for payment at stores and gas stations.

Vinatapat said he primarily purchases gas and staples at Costco.

"I'll get gas probably once per week, and I get some things like toilet paper and snacks maybe once or twice a month."

Vinatapat said he has another Visa account that offers a better percentage on rewards, so he may opt to use that card instead.

The new Anywhere Citi cards, according to creditcards.com, offer 4 percent cash back on gas purchases up to $7,000 and 2 percent cash back on Costco purchases.

Costco does require a $55 annual membership fee, and offers different business model agreements.

According to Costco’s annual report, the company has 698 stores worldwide and more than 81 million cardholders since December of 2015. There are 11 locations in Utah from South Ogden to St. George.

Brady Bingham is a reporter with more than 25 years of journalism experience. Find Brady Bingham on Facebook at www.facebook.com/brady.bingham.92?ref=name or Twitter @BradyBingham.