Visa Wins Costco's Credit Card Business
March 5, 2015 | 2 min to read
Costco announced that the retailer’s credit card network will be handled by Visa next year, an announcement that comes weeks after it sideswiped Visa rival American Express in a move that ended a 16-year relationship with the retailer.
The retailer, 19th on the Fortune 500, said Citigroup C -0.41% would be the exclusive issuer of Costco’s co-branded credit cards while Visa V 0.27% will be replacing American Express AXP 0.49% as the credit card network for Costco in the U.S. and Puerto Rico beginning April 1, 2016. Costco, known for issuing sparsely worded press releases, provided few details about the deal with Visa.
The Costco business is a big coup for Visa, as Costco is one of the nation’s largest retailers. Shares of American Express dropped last month after the credit card company announced that its exclusivity deal with the wholesale club retailer was set to expire at the end of March in 2016. As WSJ reported previously, the agreement had driven a big chunk of business for American Express. But when the arrangement ends, millions of customers will be forced to use a different credit card when shopping at Costco.
To read the rest of the story, please go to: Fortune