Costco Waves Goodbye to Amex, Inks Deal with Citi
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Today, TPG Contributor Richie Cardinale reports on the newly signed partnership between Costco and Citi.
Just last month, Costco announced that it would cut ties with American Express, ending a relationship that spanned sixteen years and accounted for a substantial percentage of annual spending on Amex cards worldwide. Only weeks after that announcement, Costco has confirmed that it will enter into a new agreement with Citi Bank beginning April 1, 2016.
The dissolution of the agreement between Costco and American Express is not the only agreement that has been in the press recently. JetBlue is also rumored to be ending its agreement with Amex in the near future. It’s not clear whether the close proximity of these two events is pure coincidence, or if there’s more going on under the surface of these press releases. Regardless, changes will inevitably be coming to those with co-branded credit cards tied to the two companies.
Some details of the new agreement cut between Citi and Costco have already been announced:
- Citi will become the exclusive issuer of Costco’s co-branded credit cards, spelling doom for the co-branded TrueEarnings Card from Costco and American Express.
- Visa will replace Amex as the credit card network for Costco beginning April 1, 2016.
- Existing Costco Amex cards will be converted to Costco Citi Visas.
Although the complete list of changes to the Costco program have not yet been made public, we should know more in the coming months. I’m especially interested to see what this new agreement means for cardholders, and look forward to hearing how the future rewards program compares to the present one.
What are your thoughts on Costco ditching American Express in favor of Citi and Visa?