Since 2019, the Costco store has been limited to accepting only credit cards from the Visa network. They also accept payments in cash, debit cards, checks, cash cards from the same store and electronic transfer of benefits.
This change to the Visa network was a big surprise for many people, because there was an agreement with retailers and Costco in which they could pay with American Express cards since 1999.
This was an agreement that occurred after a change of exclusivity. In those days it was with the Discover cards from American Express and this was because at that time AmEx had a larger number of members than Discover.
These millions were in terms of sales volume of American Express, after this Costco became a credit network and it was much bigger now that it was in union with Visa.
The Costco Credit Card and Other Visa Cards
Costco partners with Citi and Visa | CNNThere was another change that Costco made when it changed credit providers and that was the replacement of Costco’s TrueEarnings Card and American Express credit card with a new product that was Citi’s Costco Anywhere Visa.
With this new Costco store card there is better responsiveness as it is available without having to pay an annual Costco member fee. It has better rewards than the card that preceded it.
For restaurants 3% back, you get 2% back at Costco and 1% back on everything else too. There is also the benefit that it is a Visa card, which is accepted by many more merchants than American Express.
As for reward points, they can only be redeemed at Costco stores and also on the Costco store website itself.
If it is a member who does not have the Costco Anywhere Visa card, they can still benefit from said change. There are many Visa providers that have added categories in order to offer additional rewards.
These rewards qualify for warehouse stores, the meaning of this is that you can earn more cash or rewards points while using the Visa card at Costco, just check the rewards categories when you use it.
Even when customers spend more than $100,100 for purchases at a store that doesn’t offer an additional bonus, they’ll earn points for great rewards on any of their credit cards that have rewards.
How Does The Visa-Costco Partnership Save Customers Money?
But that’s not all, when the network receives the information, it sends the information to the issuing bank, in this case it could be Chase or Chiti, which in turn has to approve or deny the transaction according to the credit that is available on the cardholder’s card. .
After this, the bank will return both the approval and the denial to said network, it is sent to the processor and then arrives at the warehouse. In other words, Visa talks to the cardholder’s bank on behalf of the store and if approved, sends the funds.
If the payment network is to be used, then the merchant has to pay an interchange fee which is a percentage that corresponds to the amount of this charge. Usually this is a 2-3% charge, but Costco managed to negotiate a lower 0.5% trade-in.
How do I know if my Costco membership is current? -Hansen Power Books
With these low rates, Costco has a great ability to keep the prices quite low. You do not need to include the commission of these cards among the benefits you receive.
In the case of other competitors, they cancel up to 3% for each transaction, in the case of Costco and other stores, there is a smaller income margin and this happens because the merchandise is sold at a price that is close to the of wholesale.
This type of agreement that has been made between Visa and Costco, is with the purpose that people benefit as much as possible, in a certain way both companies are committed to the development of the population and with the improvement of purchasing power.
It is something that not all companies do, in this way there are millions of people who are benefited both directly and indirectly. When you use a credit card at Costco you are opening up many possibilities.
Not only because you don’t have to pay for your purchase immediately, but also when you swipe your card in these stores you have the advantage of saving the commission since it is quite low and you are buying any of their products for sale at a price that is difficult to beat.