What the Costco credit card is and who issues it
Costco offers two credit cards: the Costco Anywhere Visa Card and the Costco Anywhere Visa Business Card. Both are issued by Citi, not by Costco itself. You do not need a Costco membership to open either card, but you do need one to use the card's rewards at Costco warehouses.
The personal Costco Anywhere card works at Costco locations, Costco.com, gas stations, restaurants, and travel purchases. The business card works the same way but is designed for business spending and comes with different cardholder protections. Both cards charge no annual fee.
The main difference between these cards and other cash-back cards is that Costco controls the rewards structure directly. Costco changes the cash-back rates without warning, and you cannot earn rewards on Costco purchases unless you hold the card. This means the card's value depends entirely on how much you spend at Costco and whether the current rewards rates match your spending habits.
Key Takeaways
- The Costco Anywhere Visa Card earns cash back at different rates depending on where you spend: typically 2% at Costco and Costco.com, 1% at gas stations and restaurants, and 1% everywhere else.
- Costco can change the cash-back rates at any time without notice, so the card's value is not locked in.
- You must have a Costco membership to use the card's rewards at warehouse locations, though you can use the card anywhere Visa is accepted.
- The card has no annual fee, but Citi charges a foreign transaction fee of 3% if you use it outside the United States.
- The card's value is highest if you spend heavily at Costco; if you rarely shop there, a general cash-back card may return more money.
Current cash-back rates and where they explore
As of now, the Costco Anywhere Visa Card earns 2% cash back on Costco and Costco.com purchases, 1% at gas stations and restaurants, and 1% on all other purchases. These rates have remained stable for several years, but Costco has changed them in the past and may do so again.
The 2% rate at Costco is the card's main draw. If you spend $5,000 per year at Costco, that is $100 in cash back. A general 1.5% cash-back card would return $75 on the same spending, so the Costco card gains you $25 annually. The advantage grows with higher Costco spending but shrinks if you shop there infrequently.
Cash back is paid as an annual reward certificate that you can use at Costco warehouses or on Costco.com. You cannot convert it to cash or transfer it to a bank account. If you do not spend enough to redeem it before it expires, you lose it.
How the card's rewards compare to other options
The Costco card's value depends on your spending pattern. If you spend $10,000 per year at Costco, the 2% rate returns $200. A flat 2% cash-back card would also return $200 on that same Costco spending, but the Costco card wins on gas and restaurants because many flat-rate cards offer only 1% everywhere.
However, if you spend only $2,000 per year at Costco and $8,000 elsewhere, a flat 2% card returns $200 total, while the Costco card returns $40 at Costco plus $80 elsewhere, for $120 total. In this case, the flat-rate card is better.
Some cards offer higher rates in specific categories. For example, a card that earns 3% on groceries and gas would beat the Costco card on those purchases, though Costco's 2% on warehouse shopping might still win overall if you buy groceries there. The best choice depends on where you actually spend money, not on which card sounds best.
Annual membership requirement and how it affects the card
You do not need a Costco membership to open the Costco Anywhere Visa Card. However, you cannot redeem your cash-back reward certificate at a Costco warehouse without a membership. You can redeem it on Costco.com without a membership, but you pay a 5% surcharge on all purchases.
If you do not have a membership, the card still works everywhere Visa is accepted—gas stations, restaurants, online retailers, and so on. You straightforward cannot use the warehouse shopping benefit. For most people, this makes the card pointless without a membership, since the 2% rate at Costco is the main reason to carry it.
Costco memberships cost $65 per year for a Gold Star membership (the basic tier) or $130 per year for an Executive membership. The Executive membership includes a 2% reward on Costco purchases, which stacks with the card's 2% rate, giving you 4% total. However, you must spend enough at Costco to earn back the extra $65 membership fee before the Executive tier makes financial sense.
How to open the card and what to expect
You can open the Costco Anywhere Visa Card online through Citi's website or in person at a Costco warehouse. The online process takes about 10 minutes. Citi will check your credit report and typically make a decision within minutes, though some applications take a few days.
You need a Social Security number, a current address, and income information. Citi does not require you to have a Costco membership at the time of opening, but you will need one to use the card's warehouse rewards. If you are approved, your card arrives by mail in 7 to 10 business days.
The card comes with standard Visa protections: fraud liability protection, purchase protection, and travel accident insurance. Citi also offers an extended warranty on may be able to access purchases. These protections are the same across most Visa cards and do not differ based on your Costco spending.
Foreign transactions and fees outside the United States
If you use the Costco Anywhere Visa Card outside the United States, Citi charges a 3% foreign transaction fee on every purchase. This fee is added to your bill automatically and is not waived for any reason. If you travel internationally or make purchases from foreign merchants, this cost adds up quickly.
Many competing cash-back cards charge no foreign transaction fee, which makes them better for international travel. If you plan to use a credit card abroad, compare the foreign transaction fee before deciding whether the Costco card is worth carrying.
When the Costco card makes sense and when it does not
The Costco card is worth carrying if you spend at least $3,000 to $5,000 per year at Costco and have a membership. At that spending level, the extra 1% cash back compared to a flat 1% card covers the card's opportunity cost and starts to add real value. The higher your Costco spending, the stronger the case for the card.
The card is not worth carrying if you shop at Costco fewer than a few times per year, if you do not have a membership, or if you spend most of your money at other retailers. In those cases, a general cash-back card or a card that earns higher rates in categories where you actually spend money will return more money over time.
You can hold the Costco card alongside other cards. Many people use the Costco card at Costco and gas stations, then use a different card for groceries, restaurants, or travel to capture higher rates in those categories. This approach requires tracking which card to use where, but it maximizes rewards across all your spending.
Frequently Asked Questions
Can I use the Costco card if I do not have a membership?
Yes, you can open the card and use it anywhere Visa is accepted. However, you cannot redeem your cash-back reward at a Costco warehouse. You can redeem it on Costco.com, but you pay a 5% surcharge on all purchases, which erases most of the card's benefit.
What happens to my cash-back reward if I do not spend it?
Your reward certificate expires one year after it is issued. If you do not redeem it by that date, you lose the money. Costco sends a notice before expiration, but it is your responsibility to use the certificate before the important date.
Does the Costco card work at Sam's Club or other warehouse clubs?
No. The card earns rewards only at Costco, Costco.com, gas stations, restaurants, and other merchants. It does not earn the higher rate at competing warehouse clubs. You would need a separate card to earn rewards at other retailers.
Can I transfer my cash-back reward to another account or convert it to cash?
No. Your reward is issued as a Costco reward certificate that you can use only at Costco warehouses or on Costco.com. You cannot cash it out, transfer it to a bank account, or use it anywhere else.
What happens to my card if Costco changes the cash-back rates?
Costco can change the rates at any time without notice. If rates decrease, your future rewards will be lower, but your existing reward certificate is not affected. You can close the card at any time if the new rates no longer make sense for your spending.