SEATTLE – Citigroup Inc. will become the absolute issuer of Costco’s acclaim cards and Visa Inc. will alter American Express as the credit-card arrangement for Costco’s food starting in 2016, the banker appear Monday.
AmEx has been the alone acclaim agenda accustomed at Costco for the aftermost 15 years. The accord had been a benefaction for both companies, analysts said, but they ended their affiliation aftermost month.
The Costco affiliation represented 8%, or $80 billion, of AmEx’s billed business and about 20%, or about $14 billion, of its interest-bearing acclaim portfolio, Richard Shane of JP Morgan Chase & Co told The Times aftermost month.
Under the new agreement, affairs will be processed by Visa, and Citi will become the absolute issuer of co-branded acclaim cards on April 1, 2016.
The membership-only business contrarily accepts alone banknote or debit cards.
The accord is accountable to the acquirement of Costco’s existing co-branded acclaim agenda portfolio by Citi, Costco said in a statement.
The banker expects the absolute portfolio to be sold, agent Bob Nelson said. When that happens, absolute Costco associates will acquire their new cards beatific to them.
“The capacity of that will appear out bottomward the road,” he said.
The new cards will accommodate rewards to Costco members, serve as associates cards and would be accustomed at merchants common that acquire Visa acclaim cards.
Costco will acquire added Visa cards beneath the new agreement.
The accepted AmEx-Costco accord provides associates with 3% banknote aback at gas stations, 2% banknote aback at U.S. restaurants and some biking purchases, and 1% banknote aback on added purchases including Costco purchases.
Staff writers Dean Starkman and E. Scott Reckard contributed to this report.
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