Why Does Costco Not Accept Mastercard

why does costco not accept mastercard

Wondering why Costco does not accept MasterCard?

In this article, I’ll share 5 good reasons why Costco doesn’t accept MasterCard and the best card they accept, so follow up with me.

VISA is the sole credit card accepted by Costco as of 2021. You can pay with cash, cheque, debit/ATM card, EBT (Electronic Benefits Transfer), or a Costco payment card if you don’t have a Visa card.

Many people were surprised by Costco’s transition to Visa, given the store had solely accepted American Express cards since 1999. Previously, the Warehouse Club only accepted Discover cards, which have a far lower membership than American Express. The Costco-American Express partnership was a win-win situation for both companies: Costco became one of the top three retailers in the world, while American Express saw billions of dollars in sales volume. Then Costco moved to Visa, which has a far larger credit network.

Cnbc.com reports that “Shoppers can’t use credit cards from the other three major networks, American Express, Mastercard, or Discover, in Costco warehouses because Costco has a Visa contract. Purchases are done on Costco.com and the Costco app, however, can be paid with Mastercard and Discover cards.”

Best Visa Credit Cards to Use at Costco

why does costco not accept mastercard

1. Chase Sapphire Preferred.

Benefits

  • Earn 5X points on Lyft rides and trips booked through Chase Ultimate Rewards (until March 2022); 3X points on eligible dining, some streaming services, and online grocery purchases; 2X points on travel; and 1X points per $1 on all other eligible transactions (including Costco purchases)
  • Earn 100,000 points after spending $4,000 on purchases in the first three months as a sign-up bonus.
  • The annual fee is $95

If you redeem your points through Chase Ultimate Rewards, you can get $1,250 toward travel when you sign up for the Chase Sapphire Preferred. If you enjoy traveling and could benefit from the extra features, such as no foreign transaction fees, this card is a wonderful pick.

Because you’ll need to spend a lot of money on the card in the first few months to obtain the bonus, you might want to put all of your Costco purchases (and other expenditures, like Lyft, travel, and dining) on it to help you get there faster.

However, using a card with a greater cashback value, such as the Chase Freedom Unlimited, and then transferring the points to your Chase Sapphire Preferred Card could potentially earn you more points. Then, if you’ve accumulated enough points, you may redeem them for travel or other prizes rather than cashback, which will stretch your points farther.

2. Chase Freedom Flex.

Benefits:

  • Rewards: 5% on rotating quarterly categories (up to $1,500 spent) and travel purchased through the Chase Ultimate Rewards portal; 3% on restaurants (including takeout and delivery) and drugstores; and 1% on everything else.
  • Sign-up Bonus: Get $200 after spending $500 in the first three months, plus get 5% cash back on grocery store purchases (excluding Target and Walmart; up to $12,000 in the first year)
  • There is no annual fee.

If you remember to activate your bonus category each quarter, you can earn a lot of points by purchasing in each category with your Chase Freedom Flex. And, with no annual fee, it’s a terrific card to have on hand for collecting points in the bonus categories, especially when combined with a Chase premium card. You can transfer points to Chase’s airline and hotel partners by transferring them to your premium account.

Every quarter, the bonus categories change, but if wholesale clubs are announced as one of the categories for the future quarter (as they usually are), you can activate your 5% cashback and go crazy at Costco. You’ll get $75 cashback after spending $1,500 during the quarter (that’s a lot of spinach and maple syrup).

3. Chase Freedom Unlimited.

Benefits:

  • Bonuses: 5% on travel purchased through Chase Ultimate Rewards, 3% on dining and pharmacy purchases, and 1.5 percent on everything else.
  • Sign-up Bonus: Get $200 after spending $500 in the first three months, plus get 5% cash back on grocery store purchases (excluding Target and Walmart; up to $12,000 in the first year).
  • There is no annual fee.

If you’re searching for a method to earn up to 5% cashback with one of the top rewards credit cards, the Chase Freedom Unlimited Card is a good option. Also, as this card has no annual fee, the potential to earn a $200 cashback incentive after spending $500 in the first three months, as well as earn 5% cashback on grocery store purchases (excluding Target and Walmart; up to $12,000 in the first year) is an added bonus.

This is an excellent card for Costco purchases, and the savings you’ll earn at the warehouse club will help you get the most out of your membership.

4. Cash Back with No Limits

Benefits:

  • Quicksilver Cash Rewards from Capital One
  • Bonuses: Get 1.5 percent cash back on every transaction, every day.
  • Limited-time offer: Get $200 in cash back after spending $500 in the first three months.
  • There is no annual fee.

Because of the significant 1.5 percent cash back returns on every transaction, every day, the Capital One Quicksilver Cash Rewards Card is a good pick for non-bonus spending. It’s also a good card to have in addition to premium cards that earn more rewards in bonus areas because there’s no annual fee.

To get the most out of your benefits, spend at least $500 in the first three months — which can include Costco purchases — to qualify for the bonus. Unless you also have Chase Freedom and have the opportunity to receive 5% back on wholesale club purchases, this is an excellent card to use for everyday Costco shopping.

5. Visa Card for Costco Anywhere

Benefits

  • Cash back: Earn 4% cash back on eligible gas purchases (up to $7,000), 3% cash back on restaurant and travel purchases, 2% cash back on all other Costco purchases, and 1% cash back on all other transactions.
  • There is no sign-up bonus.
  • No annual fee if you have a paid Costco membership.

While the Costco Anywhere Visa Card does not offer a sign-up bonus, the 3% back on eligible restaurant and travel purchases and 4% back on eligible gas purchases (on up to $7,000 per year) are significant rewards for a card with no annual fee.

With any of the cards on our list, you’ll also get the best cashback rewards for Costco purchases. However, a cashback credit card like the Chase Freedom Unlimited, especially when paired with a Chase premium card like the Chase Sapphire Preferred, may provide more value in terms of rewards.

If you don’t already have a Chase premium card, this one could be a good option for your Costco shopping. Use member discounts on big-ticket items like furniture and appliances, because the more you spend with your card, the more you earn. To get the most out of your membership, make it a point to buy your gas from Costco.

Why does Costco not accept MasterCard?

  • Because they have an exclusive agreement with Citi Bank to offer Costco Visa cards at a discounted rate. Because it is a VISA card, they must accept all Visa cards.
  • Because When a customer uses a credit card to make a transaction, the merchant pays the card issuer a percentage of the entire charge. Credit card issuers (usually banks) generate money in this way.
  • Because Costco has an exclusive relationship with American Express for 16 years. A mutually advantageous cooperation for both companies. The two companies were unable to reach an agreement on new conditions when the agreement was up for renewal in 2016. A Costco Amex card was held by one out of every ten American Express customers. Citi won the bid, and the Amex/Costco alliance ended in June 2016.
  • Because debit cards are not covered by the agreement, Costco accepts them.
  • Because The Visa brand is owned by the Visa Corporation, Allowing a merchant to accept a card from a single issuer is not in their best interests.
why does costco not accept mastercard

Unlike the Amex deal, which only involved Costco and Amex, the Citi partnership involves Costco, Citi, and Visa. Everyone has a vested interest in the outcome.

Amex is a credit card company, as well as a bank and the owner of the Amex brand.

Alternative ways to pay at Costco

Costco has a variety of payment options.

While a Visa credit card is the greatest way to earn points on purchases you’d make anyway, you don’t have to be concerned if you leave your card at home or are still waiting for it to arrive in the mail.

Cash, checks, debit/ATM, EBT, and Costco Shop Cards are all accepted at Costco. To pay by check, you’ll need a valid government-issued ID.

Another thing to remember is that Costco gas stations and car washes do not accept cash, checks, or EBT, so you’ll have to pay with your Visa card, debit/ATM card, or Costco Shop Card.

C:\Users\BRAVE\Desktop\YZ\3.PNG

FAQ About issues of Costco Accepting Either Visa or Credit Card (Explained)

What debit cards does Costco accept?

Costco says it accepts most PIN-based debit cards, so as long as you know your personal identification number, you should be fine (PIN). If you want to use your debit card as credit in a store, first make sure it has a Visa logo on it. If it does, you’ll know it’s possible.

Is the Apple card accepted at Costco?

The Apple Card is a MasterCard-based card that is not accepted at Costco. However, you could load your Apple Card into your Apple Pay account and use that to pay for your Costco purchases.

Is it possible to use Samsung Pay at Costco?

At Costco, you can use Samsung Pay, Apple Pay, or Google Play.

Costco accepts which credit cards online?

You will have more payment options when shopping online with Costco than when shopping in the store. All Visa, MasterCard, Discover, Costco Shop cards, the majority of PIN-based debit or ATM cards, and Visa checkout are accepted at Costco online.

The Citi Double Cash Card is one of the best cards for online shopping because it offers up to 2% cashback on all purchases: 1% when you buy and 1% when you pay.

Does Costco accept Mastercard?

Yes, Visa credit cards are accepted at Costco warehouses and gas stations. Mastercard, American Express, and Discover are not accepted.

The Chase Freedom Flex is an excellent Visa card for Costco shopping, especially when warehouse clubs are one of the quarterly bonus categories, as it offers you 5% cashback on Costco purchases (up to $1,500 in purchases).

C:\Users\BRAVE\Desktop\YZ\2.PNG

What Next:

Because Costco personally negotiated a significantly better bargain with Visa. It all boils down to how much a merchant pays and the merchant rate, which determines how much of the transaction is invoiced back to the merchant for processing. Costco demands extremely competitive pricing from all of its vendors, including those who handle credit cards, as they do with everything else. Costco accepts MasterCard debit cards since the merchant rate is set and cannot be changed significantly. And because debit cards are accepted, Costco is paid the next day.

Recommended Readings:

Best Premium Travel Credit Cards For Road Trip

6 Best Trip Planning Strategies For Travelers On A Budget

Spread the love

Leave a Reply

Your email address will not be published. Required fields are marked *