Costco to Switch from Amex to Visa

Costco Credit Card. Graphic/photos by Wendy Osher.

By Wendy Osher

Visa will replace American Express as the credit card network for Costco Wholesale Corporation in the US and Puerto Rico.

The news comes as the partnership agreement between Costco and American Express is set to end on March 31, 2016.

American Express Chairman and Chief Executive Officer Kenneth I. Chenault issued a statement saying, “we were unable to reach terms that would have made economic sense for our Company and shareholders. Instead, we will focus on opportunities in other parts of our business where we see significant potential for growth and attractive returns over the moderate to long term.”

As the American Express agreement comes to an end, all co-branded American Express/Costco cards can be used any place American Express cards are accepted through March 31, 2016.

The new new co-brand incentive agreement with Visa is scheduled to begin on April 1, 2016.  Under the agreement, Citi will become the exclusive issuer of the Costco’s co-brand Visa credit cards.

According to a Costco announcement issued on Monday, the new card will provide rewards to Costco members, serve as the membership card to the warehouse retailer, and would be accepted at all merchants worldwide that accept Visa credit cards.

Additional information will be provided to Costco members in the coming months.