Costco credit cards are one of the most well-known and well-respected credit card brands. They provide their customers a credit card with a cash back option along with rewards that make purchasing anything from groceries to airfare simple. And even in their partnership with MasterCard, they have continually tried to differentiate themselves from the traditional credit card and merchant account card markets. In this article, I will compare Costco with other leading merchant account card brands and explore how they stack up to each other. Then, I'll compare Costco with major online dailies such as PayDotCom, AltaVista, or even regional grocery stores such as Whole Foods Market (WFM).
The cash back option on Costco card is very solid. You can use it for virtually any category of purchase you want to make and you usually get around 5% back just for using your card. While that may not seem like much, when you consider the cash back rate on many other cards it is actually a very generous reward program.
Now, let's compare Costco to its major competitors. When it comes to rewards, Costco has some really nice ones to choose from. They offer the most cash back on dining out and gas, and then follow that up with an excellent reward program on coffee, tea, clothing, electronics, and a little car maintenance service. Compare that to other cards that offer similar cash back programs, and it is easy to see why you may prefer them over other companies. Plus, when you pay bill online with a Costco card, you typically get the benefit of reduced fees and interest, which means that you end up saving money on those purchases as well.
But what about their customer service? The folks at Costco aren't always helpful. And while customer service in general isn't necessarily bad, it can be seen as a reason for customers to stay away from a brand. If you are ever unhappy with your Costco card's benefits, it isn't hard to find someone who will be more than happy to tell you how they wish they had made different choices, or perhaps never have bought anything from that particular store. They tend to be a very insistent kind of customer. And that can be a problem, because a Costco card is supposed to give you all of the rewards you could possibly want.
That being said, it is possible to get a good rewards program on a Costco card. However, if you plan on sticking with just the grocery and drugstore rewards, you are probably better off simply using a credit card that does not offer rewards programs at all. A balance transfer to a no-fee card with Costco is a great way to get started toward building your savings, because you won't have to pay interest or any monthly fees until you have saved enough money to transfer. And once you have that saved money, you can then use it to earn cash back. That way you won't have to wait long before using your credit card cash back rewards.
You may also be able to find Costco credit cards that offer an airline miles program. This allows you to earn air miles regardless of whether you are flying out of the city you purchased your Costco card from or not. Air miles are earning rewards and should be kept in mind when looking at credit cards with cash back programs that provide rewards. In general, you want the highest cash back percentage you can get from your Costco card.