If you are a Costco US shopper, Costco announced last year that they would be switching from American Express to Visa for cards accepted in stores, as well as for their Citi co-branded card. This change was due to take place on April 1, 2016, but has now been pushed back to sometime this summer.
Sadly, they aren’t even very exact now about when the change will take place, just saying it will happen in June or by mid-summer (which I guess is July).
The timing of the transition is “fluid,” Richard Galanti, Costco CFO, said. “It’s between Amex and Citi — negotiating and completing the agreements to do that transition.” For customers, he said, “There won’t be any gap in the middle.”
I think the issue is in how Citi can deal with the transfer of Costco customer account data from American Express since they obviously have different card number formats and systems. In any case, it is making things very difficult for Costco customers that have an American Express card since they are now not sure if they will get their rewards from continuing spending on the Costco American Express. Plus, I have had emails from several readers with American Express cards that are about to expire and they are wondering how to proceed with getting a new American Express or not.
As you know, I’m a big fan of Costco, but this whole process has been handled very poorly, in my opinion. Perhaps even worse than this waffling on when the new Visa deal will actually start, is that no one seems to want to give any information to customers about what benefits they can expect from the new co-branded Citi Visa card. Will the cash back percentages be exactly like those of the existing American Express or better? Will there be other benefits? Is the new card actually going to be worse for Costco customers? The only good news is that once they do start accepting Visa, any Visa card can be used not just the co-branded one, and since a lot of people already have Visa cards you won’t have to sign up for the new co-branded card unless it is as good or better than the existing co-branded American Express Costco card.
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