Costco has dubbed the two companies as its new credit partners starting in April of next year, reports the Wall Street Journal. Previously, only AmEx credit cards and debit cards were accepted at the wholesale retailer.
This means only Citi will be able to issue Costco co-branded credit cards, and it will make Visa the exclusive credit-card network for Costco’s stores. While it’s clearly a big win for Visa and Citi, Costco hasn’t revealed any financial terms of the deal.
It would seem that whatever the agreement involves, it’s more favorable for Costco than the arrangement it had with AmEx: Costco had been trying to come to new terms in its AmEx deal, but the two sides couldn’t reach a mutually beneficial decision, the company said. Instead, Costco said that ending its relationship with AmEx was about saving money for customers.
As of March 31, 2016, AmEx Costco-branded credit cards will be useless, giving customers just over a year to make the switch — if they want to. Customers can still use debit cards from either Visa or MasterCard, as well as Costco cash cards, which can be purchased online.
Costco Names Citi, Visa as New Credit Partners [Wall Street Journal]