What Are the Benefits of a Costco Visa Credit Card?

the benefits of a costco visa credit card

The benefits of a Costco Visa credit card may be too good to pass up.

This month, I decided to test the waters and sign up for a Costco membership. It is not often that I necessarily need groceries in bulk, being that I live in a household of two; however, having the ability to purchase other household items in bulk (like toiletries and cleaning supplies) along with other miscellaneous items, attracts me.

Among the advantages of their store discounts is the Costco Visa credit card, which was briefly discussed with me upon my signing up. In the moment, I did not have time to learn more, but I was provided with just enough information to want to dig. Actually, it was when the representative at Costco mentioned to me that she was able to rent a car for her recent trip at just $12 a day that my interest had been piqued. So, this week, I began to look into the benefits of a Costco Visa credit card.

About the Costco Visa Card

Costco always offered its own exclusive credit card to members, but previously it was with American Express. In June, the warehouse chain and AmEx broke up after sixteen years together, though, causing a bit of an initial upset among members. One would imagine with any big switch issues would arise, and this was certainly the case for Costco and its newly co-branded card with Cita. In fact, it took a little over two months for some customers’ problems to be resolved. This did, unfortunately, result in cancellations as well.

Despite this, Costco continues to push forward, providing even better benefits for members than they had with AmEx.

Benefits of a Costco Visa Credit Card

I discovered that their partnership with AmEx gave cardholding members a 3% cash back on gas purchases of up to $4,000 annually, 2% percent on restaurants and travel, and 1% cash back on other purchases as well as roadside assistance. However, the benefits of a Costco Visa credit card include:

  • Costco cash rewards everywhere Visa is accepted
  • No annual fee with a Costco membership
  • A 2% cash back on all purchases both in-store and through Costco.com
  • A 0% intro APR on purchases for the first seven months; then, the APR bumps up to 15.74%
  • An improved cash back percentage of 4% on gas purchases of up to $7,000 annually, and 3% on restaurant and travel purchases
  • Still 1% cash back rewards on all other purchases

Another perk is that you could even use this as a business credit card, still earning the same rewards. With every, perk, though, comes terms and conditions. Not to mention, it does also double as your Costco membership ID. And, I am all about versatile products.

Details to Keep in Mind

In order to know what fees I would be up against, I found Citi’s disclosures. In addition to the 15.74% APR after seven months, which actually varies based on the prime rate, there is a 22.49% APR rate for cash advances with either a $10 or 5% fee for the transaction, depending on which is higher. And, if there are any late payments, I would not only be subject to a $37 fee but also a 29.99% penalty APR, depending on creditworthiness. (Luckily, my credit is great.)

I would also want to be careful to make sure that my Costco Visa card was not charged with my annual membership fees since I do not feel I would want that.

 Worth Considering

If I keep my Costco membership, it may be worth considering their Visa card. The benefits of a Costco credit card are enticing. Although, I have found that other options may actually lead to more cash back on purchases like gas and travel, thanks to Consumer Reports Credit Card Comparison Tool.  While Costco’s credit card claims to have more cash back rewards than any other card, I will have to take some time to consider where cash back rewards may work best for me along with comparing the APR rates and fees.

Do you have a Costco credit card? What do you think of its benefits? 

Photo credit: frankieleon