The 5 Best Visa Cards for Costco Purchases

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by parag
Last Updated: June 19th, 2016
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KEYWORDS:#creditcards #tips #rewards #cashback #citi #visa
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Starting June 20, the Costco American Express Card will not be accepted at Costco any longer. This is a result of American Express and Costco terminating their 16-year-long relationship. 

Costco has now tied up with Visa, and the AmEx card has been replaced by the Costco Anywhere Visa Card by Citi. By this time, each AmEx cardmember would have received the replacement card.

Is the new Costco Anywhere Visa Card by Citi as good as the Costco American Express Card? Fortunately, cardmembers need not worry on this count. Not only does the Citi card offer a host of benefits, there are several other Visa cards on offer that have a number of attractive features.

 

Here are the new Visa cards that offer the greatest rewards and benefits.

1. Costco Anywhere Visa Card by Citi - Citigroup has ensured that they give AmEx cardmembers who have been issued the Costco Anywhere Visa Card by Citi automatically, a much better deal.

  • The new Citi Visa card gives you 4% cash back on eligible gas purchases worldwide, including gas at Costco for the first $7,000. The cash back after you reach this limit is 1%.
    In comparison, the old AmEx card gave only 3% cash back at US gas stations up to a limit of $4,000 per year.
  • On the new Citi Visa card, you are eligible for 3% cash back on restaurant and eligible travel purchases worldwide.
    The old AmEx card had a lower cash back of 2%.

The Costco Anywhere Visa Card by Citi also gives you 2% cash back on all other purchases from Costco and Costco.com and 1% from all other purchases.

With the switchover from the AmEx card to the new Citi Visa card, Citigroup has gone to great lengths to maintain the same or a better level of benefits. For example, Citi has clarified that although their standard purchase APR (annual percentage rate) is 15.49%, if an AmEx cardmember enjoyed a rate lower than this, the same APR would be maintained by Citi.

What’s more, the Costco Anywhere Visa Card by Citi does not have any annual fee. Of course, you still need to pay for your annual Costco membership.

To make the transition as painless as possible, Citigroup has arranged for any of the cash back rewards that you have already earned from your Costco card from American Express to be automatically transferred to your new Citi card. 

This transfer will take place on June 20, 2016. When you receive your February 2017 cash back rewards coupon from Citi, it will include cash back rewards earned on your Costco card from American Express during 2016 that have not already been given to you. 

Costco Anywhere Visa® Card by Citi
APPLY NOW
intro apr
N/A
N/A
regular apr
15.49%
12.24%-16.54% Variable
fees
$0
 
promo

4%

Cash Back on Costco Gas

Show Details

 

2. Chase Freedom – The Chase Freedom Visa Card is another great option for purchases from Costco. Apart from the other benefits that it offers, it has a 5% cash back offer on up to $1,500 in combined purchases in bonus categories for each quarter in 2016. 

Once you activate the category, you will receive 5% cash back for the amount that you spend in restaurants, gas stations, and wholesale clubs. If you opt for the Chase Freedom Card, you can get 5% cash back for your purchases from Costco. But remember that the total amount on which the cash back is available is limited to $1,500.

The offer is very flexible as you can activate the cash back option as late as September 14, 2016, for the July – September quarter. 

In addition to this benefit, the other advantages that you get with a Chase Freedom Card are:

  • You do not need to pay any annual fee.
  • If you spend $500 within three months of opening your account, you will be eligible for a $150 bonus.
  • For the first 15 billing cycles, you will get a 0% introductory APR. After this period, a rate of 14.24% to 23.24% will apply based on your creditworthiness.
  • Similarly, you will be eligible for 0% introductory APR for the first 15 billing cycles on balance transfers. A balance transfer fee of 5% or $5, whichever is greater, will apply.
  • You are also eligible for a 1% unlimited cash back on all purchases. This reward does not expire as long as your account is open.
  • The card also comes with a wide range of security features. For example, if any unauthorized amount is charged to your Chase Freedom Card, you will not be responsible for payment. 

Additionally, you are entitled to purchase protection covering your new purchases for 120 days against damage or theft up to $500 per claim and $50,000 per account.

But the greatest benefit of the Chase Freedom Card is that in the three months from July to September you can get 5% cash back on your purchases from Costco, subject to a purchase limit of $1,500.

Chase Freedom®
APPLY NOW
intro apr
0%
0% Intro APR for 15 Months
regular apr
14.24%
14.24%-23.24% Variable
fees
$0
 
promo

$150

Cash Back Bonus

Show Details

 

3. BankAmericard Cash Rewards Credit Card – This is another good option for Costco shoppers after June 20 when their AmEx cards will no longer be valid.

The BankAmericard Cash Rewards Credit Card gives you 1% cash back on every purchase, 2% at grocery stores and at wholesale clubs and 3% on gas for the first $2,500 in combined grocery/wholesale club/gas purchases each quarter.

You are also eligible for an attractive introductory rate of interest. For the first 12 months, 0% APR will apply for purchases. There are more savings to be had in the form of concessions on balance transfers from other cards.

If you transfer any balance from another card to your new BankAmericard Cash Rewards Credit Card within 60 days of opening your account, you are eligible to 0% APR for the first 12 billing cycles. A balance transfer fee of 3% would apply.

Once the 12-month introductory period is over, a variable APR that is currently at 13.24% to 23.24%, will be levied.

There are other advantages that you get with this card. For one, there is no annual fee. You also get a $100 cash reward bonus after making at least $500 in purchases in the first 90 days from the date of your account opening.

BankAmericard Cash Rewards™ Credit Card
APPLY NOW
intro apr
N/A
N/A
regular apr
13.24%
14.24%-23.24% Variable
fees
$0
 
promo

$100

Cash Rewards Bonus

Show Details

 

4. Chase Freedom Unlimited – This flat-rate-cash-back card is another great option from Chase. The features that it offers are different from the Chase Freedom Card.

Shoppers at Costco often make big-ticket purchases. The Chase Freedom Unlimited card’s best feature comes in handy for a situation like this because it offers 1.5% cash back on every purchase for an unlimited amount.

An added bonus is that your cash back rewards do not expire as long as your account is not closed. New cardmembers also earn a $150 bonus after spending $500 on purchases within the first three months of account opening.

There are two additional ways that cardmembers could maximize their reward points with the Chase Freedom Unlimited card if they use it in conjunction with another Chase card. First, if you have a Chase Freedom card, you could earn 5% cash back by making purchases in the quarterly rotating categories.

This means that in the July-September quarter you could use the Chase Freedom card to shop at Costco and earn 5% cash back. For other purchases, you could use the Chase Freedom Unlimited card instead, and earn 1.5% cash back. This would give you 0.5% additional cash back.

The second way that you could benefit is if, in addition to the Chase Freedom Unlimited card, you also have a Chase Sapphire Preferred card. If you redeem the points earned on your Chase Freedom Unlimited card on the Sapphire card through Chase’s travel portal, you get a value of 1.25 cents per point.

In fact, if you move points to the loyalty programs of United Airlines and Hyatt you could increase the value you get even more.

Chase Freedom UnlimitedSM
APPLY NOW
intro apr
0%
0% Intro APR for 15 months on purchases
regular apr
14.24%
14.24% Variable
fees
$0
 
promo

$150

Cash Back Bonus

Show Details

 

5. Chase Sapphire Preferred – Although the Chase Sapphire Preferred gives you only one point per dollar on purchases, it does offer two points for the amounts spent on travel and dining. 

One of the highlights of this card is that you get to earn 50,000 bonus points after you spend $4,000 on purchases within the first three months from account opening. This translates into $625 in Travel Rewards when you redeem through Chase Ultimate Rewards.

Additional benefits include zero transaction fees for purchases made outside the U.S. The Chase Sapphire Preferred card has a yearly fee of $95, but this is reduced to $0 for the first year.

 

Chase Sapphire Preferred®
APPLY NOW
intro apr
N/A
N/A
regular apr
16.24%
16.24% - 23.24% Variable
fees
$95

waived for the first year

promo

50,000

Bonus Points

Show Details

 

Costco’s move to Visa will help shoppers

Costco’s exclusive arrangement with Visa will prove to be a boon for those using credit cards to make purchases. The Costco Anywhere Visa Card by Citi offers consumers great benefits and is an improvement on what was available earlier to Costco members.

In addition to providing tremendous advantages to cardmembers at Costco, the new Costco Citi Visa card can be used at all the establishments that accept Visa. 

Consumers opting for a card other than the Costco Citi Visa, have a wide range of other Visa cards to choose from. The right choice for them would depend on their purchasing pattern and the amount that they spend using their credit cards.

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