Business owners are likely familiar with the benefits and drawbacks of a Costco membership. The introduction of the Costco Anywhere Visa® Business Card by Citi is even another reason to shop at Costco. In the corporate world, Costco members, frequent fliers, and gourmet eaters all stand to benefit from the Costco Anywhere Visa Business Card and its significant cash back incentives.
Only current Costco members are eligible to apply for a Costco Anywhere Visa Business card. A valid and current Costco membership is required for eligibility and use. A Costco business membership is $60 annually (plus tax in your area). A Costco Executive Business Membership costs $120 per year, including taxes, and provides members with a 2% return (up to $750 per year) on selected purchases. No matter whatever membership level you have, your credit card will always serve as your Costco ID, so you can leave your membership card at home.
The cash back program on the Costco Anywhere Visa Business card is excellent. Gas purchases (including those made at Costco gas stations) get 4% cash back on the first $7,000 spent, travel and dining purchases earn 3% cash back on the first $30,000 spent, and Costco and Costco.com purchases earn 2% cash back on the first $30,000 spent. However, there is no welcome offer or promotional 0% APR period.
Earning Cash Back Benefits
Everywhere Costco The cash-back rewards system offered by Visa for business is segmented into four tiers:
- 4% Tier: The first $7,000 spent annually at qualified gas stations, including Costco gas stations and retailers categorized as gas stations, receives 4% cash back.
- 1% back on qualified petrol purchases is limitless above the yearly maximum. In addition to not earning 4% and not counting against the spending limit, gas purchases made at supermarkets, convenience shops, grocery stores, and warehouse clubs other than Costco are also disregarded. In its place, it accrues 1% cash back, forever.
- Tier 2: Earn an unlimited 3% cash back on dining out and travel purchases including airline, hotels, rental cars, and vacation packages from places like Costco Travel.
- Spending at Costco and Costco.com for anything other than petrol will earn you an infinite 2% cash back, thanks to the 2% tier.
- All other purchases are eligible for limitless 1% cash back at the 1% tier.
Redeeming Cash Back Bonuses
With your annual February account statement, you will receive a voucher for the whole previous year’s cash back earnings. At any Costco warehouse, you may exchange this coupon for either store credit, cold hard cash (or a paper check), or a combination of the two.
If the value of the coupon is more than the amount you wish to redeem, Costco will issue you a paper check or credit your account. To obtain a voucher, you must accumulate at least one dollar in rewards per year. You will lose any incentives you have earned for the year if you do not reach the $1 level by December 31st.
The card itself has no yearly cost. Cardholders, however, must keep their yearly Costco Business Memberships active and paid in full (at a minimum of $60 plus any relevant local tax). There will not be any additional charges for making a foreign exchange.
The perks that come with using this card are helpful. For example:
- Free rental vehicle insurance when you pay in full with your card; purchase protection (up to $500 per covered item) for up to 120 days after purchase;
- We provide a basic kind of travel insurance that is valid everywhere in the globe for no cost to you.
Good credit is needed for this card. If you have serious credit problems, you probably won’t be considered.
- Excellent Benefits for Eating Out and Taking Vacations. When it comes to discounts on eating out and taking trips, the Costco Anywhere Visa Business card is among the finest available. With this card, you may get a flat 3% cash back on all dining and travel expenses, which is more than double the rewards offered by most other cards.
Infrequent Costco Shoppers Can Still Get 2% Cash Back on All Their Purchases. You may get 2% cash back on as many purchases as you like at Costco and Costco.com with the Costco Anywhere Visa Business card.
- All Executive members of Costco have this perk, albeit without a card they are limited to $750 in points each year. The good news is that Costco Anywhere Visa Business cards are not subject to the $750 annual rewards cap and do not need to pay the additional $120 per year (plus tax) for Executive membership in order to receive 2% back at Costco. This card is the most affordable way to get a 2% bonus on your Costco purchases.
- Beneficial Gas Discounts for Cautious Motorists. The gas discount that comes with the Costco Anywhere Visa Business card is a nice perk, too. While there is a $7,000 annual limit on petrol purchases, very few business credit cards provide cash back on gas purchases at all, much alone 4%. At the end of the year, you’ll have earned $280 just for using petrol if you spent up to the limit. However, a card with a smaller, uncapped gas benefit might be a better value if your company has a fleet of cars or if you spend a lot of time commuting to and from appointments.
- There is not a yearly charge for using the card. This card does not charge an additional yearly cost on top of the $60 annual (plus tax) Costco membership fee that is required to use it. As a result, its yearly fee is cheaper than those of competing business credit cards like the $95 Chase Ink Plus.
- There will be no extra charges when making a foreign transaction. Good news for Costco members who don’t have ready access to Costco clubs outside of the United States who reside abroad (or go abroad regularly).
- Must be a current Costco member to purchase. Only active Costco members can use the Costco Anywhere Visa Business card. The card effectively has an annual price of at least $60, given that a standard Costco business membership costs at least $60 per year, plus any relevant local sales tax.
Even while a Costco membership is a worthwhile investment for serious bulk supply consumers running a small business, the annual cost cuts down the card’s cash back returns. If you don’t frequently eat out, travel, or fill up your car with petrol, and your business doesn’t have a high need for the kinds of materials sold at Costco, then this card is definitely not for you. Consider applying for a business credit card like Capital One Spark Cash Select, which offers cash back on all purchases with no annual fee.
- Get in line, since you can only cash in your rewards in person. In contrast to other types of business reward credit cards, Costco Anywhere Visa Business requires you to redeem your benefits at a physical Costco facility. You can get either cash or shop credit if you produce the coupon that arrives with your February billing statement. If you frequently buy at Costco and live close by, this isn’t a big concern, but if you prefer less frequent Costco excursions, it can be rather bothersome. After all, you wouldn’t want to drive an hour to the nearest Costco just to realize in the checkout line that you forgot your coupon at home. This isn’t a problem with most other company reward cards, as you can get your cash back in the mail or online.
- There is no Joining Bonus. There’s no welcome offer with this card. When compared to the sign-up incentives offered by many rival business cash back and travel cards—some of which can be worth $500 or more—this is a significant negative.
- You are limited to one annual reward redemption. There is an annual limit of one redemption per person for all cash back awards. It goes without saying that most alternative cash back cards are far more accommodating, allowing redemptions as often as cardholders like (subject to minimum redemption levels in some situations).
- It’s hard to travel with gas because of the category limits. The gas category on this card may limit your options. Gas purchases made at Costco and other businesses classed as gas stations only earn you 4% cash back (up to $7,000 in spending per year). Other warehouse clubs, supermarkets, superstores, and retailers classed as convenience stores all get 1% cashback on gas purchases. This is a major drawback if you can’t afford to routinely refuel at a Costco or other conventional gas station.
- Unreasonably Accurate Fraud Detection. Anywhere You Find a Costco Anecdotal evidence from cardholders suggests that Visa Business’s built-in fraud detection system is extremely sensitive, incorrectly marking perfectly legitimate purchases as potentially fraudulent. One Costco member claimed her account was frozen after she spent over $200 at a competitor’s large box shop. A second customer was identified after making 5 purchases in a 60-mile radius on the same day. Despite the fact that methods for detecting fraud are constantly evolving, current methods remain insufficient.
When considering the Citi Costco Anywhere Visa® Business Card, it’s important to keep in mind that in addition to the limitless 1.5% cash back on all other purchases made with the card, cardholders will also get 2% cash back on all purchases made at Costco and Costco.com.
To obtain the 2% cash back on Costco purchases without this card, you need to be an Executive member, which costs an additional $120 per year (plus tax). Cardholders of the Anywhere Visa Business Card can earn an unlimited 2% cash back for just $60 per year, plus tax.
The Costco rebate alone may be enough to justify getting the Costco Anywhere Visa Business Card if you currently shop at Costco frequently or can simply modify your shopping habits to take advantage of this promotion.