mia

Let's try to understand one another's thinking. I don't care if people agree with me, but understanding is worthwhile.

When Forward was introduced ThankYou Rewards was a penny-a-point currency. 5 points per dollar = 5%. It was Citi's entry into the same category as Chase Freedom and Discover. If they made a mistake it was to include bookstores as a category because that picked up Amazon and created huge exposure. (Forward was an extension of the MTV card which was only offered to students, and I suspect Citi was thinking of textbooks.)

In 2014 Citi did something out of the ordinary. They revalued ThankYou Rewards upwards, by adding airline transfer partners and the $0.016/point redemption rate for AA tickets. Suddenly, 5 points per dollar = 8%, and Freedom becomes unsustainable.

I expected Citi to reduce the bonus category earn rate from 5X to 3X, but then the Premier and Prestige cardholders would have whined about those cards not earning 3X in the dining and entertainment categories.

And so they are winding it down, and they had the decency to provide ample notice.

Costco will be an entirely different proposition because the rewards are in cash, not points, and because two other are companies are involved: Costco and VISA.

krazykanuck

I think the card will get plenty of use from the less sophisticated Costco shoppers (the one card users, etc) but I do think that this is going to wind up costing Citi/Visa more than they expect.

I'll definitely be using my Chase Freedom there for the rest of the year. Those two companies can figure out how to pay Chase, since all the news articles made it seem like Costco isn't really going to be picking up the tab for non-Citi visas.

mingw

the amex true earnings card used to have 3% on both gas and dining. later they dropped the dining to 2%.

so costco was to decide which company they offer contract:
AMEX: 3% gas, 2% dining/travel, 1% everything else. AMEX couldn't reach the deal with costco, meaning not going to make profit.
CITI: 4% gas, 3% dining/travel, 2% costco, 1% everything else. with this clearly more money would get sent to card holders than AMEX's card, I highly doubt citi can make profit... I would expect citi cuts benefits in just couple of years. although citi does benefit from the card being VISA thus likely more spending on "everything else" than AMEX.

garykung

Visa will not have an impact. While I agree that Costco can prevent (or at least slow down) the downgrade from happening, Citi will drop Costco if Citi can't justify the profits. Beside, per the post above:

On that basis, I incline not to trust Citi.

freeflyin

We will also be using Freedom for Costco and restaurants , cutting into the Citi card dining category also.

As of this point, it appears that at least through the end of this year, our Costco card will be used only for gas.

jackal

I've been traveling and won't be home for awhile longer, so I have not had a chance to get my new Visa. I just called Citi to try to get a duplicate sent to me while I'm traveling, and they aren't able to do anything with the cards, including requesting a replacement, until the accounts are active and the data is all transferred over on June 20 (the cards that have already been sent out were apparently based on static data provided by Amex, but they won't have access to live data or to make any changes until the active date of June 20).

However, they said I can call anytime after midnight Eastern time on June 20 and they can put in an expedite request to have the card overnighted. Since I'm in Alaska at the moment, calling Sunday night at 8:01pm seems quite reasonable.

HGHUA

I was reading a bit about product conversions with citi and some blogs say citi is pretty flexible when it comes to PC. Wonder if I can convert a Premier to this. Was thinking about going for this anyways and was gonna convert my premier to DC but this kills two roaches (oh look a cute bird) with one stone...

GloballyServiced

Is the 4% gas on any typical gas station or just Costco gas stations? There was some weird verbiage about that in the disclaimers about convenience stores, etc

Having foreign transaction fee at all, much less 3%, makes it a joke, but I would use it for gas maybe.

mia

All typical gas stations are included in the first sentence. The exclusions are listed in the third sentence.

GloballyServiced

Thank you for pasting the verbiage I was talking about, but those disclaimers are pretty significant. Most gas stations are a convenience store.

For those of us not familiar with the lingo, what does that mean.

mia

It means that if the merchant's credit card processing account is setup as a food store, rather than as a gasoline station, you will not receive the bonus. Merchant account codes are typically chosen by the merchant's acquirer, the company which processes their credit card transactions, not by VISA or Citi.

In general, I think it will be safe to buy at a petroleum branded station (e.g. Exxon, Mobil, Chevron, Shell, etc), and there will be uncertainty when buying at food market branded outlets (e.g. 7/11). There will be exceptions both ways, and this same will be true for any card which offers a gasoline bonus category.

jackal

FWIW, an older card I have distinguishes between fuel purchases made at the pump versus inside (I get 2x points on the former but not the latter). This leads me to believe that the card readers installed in pumps themselves are often coded with different merchant codes than the card readers inside at the till.

I don't know how that would affect the earnings on this particular card, but it may play a part.

jackal

So, replying to myself with an update:

I called the Costco card line at 12:50am ET and waited on hold 42 minutes before speaking with a clearly tired and frazzled agent who told me that while they were supposed to have everything active now, things were still not up yet and would not be for at least a couple more hours. He just kept apologizing--he had probably spent the previous hour and a half listening to call after call yelling at him for not being able to even access their accounts. I tried to be as nice as possible, though I was frustrated to have spent so long on hold to end up with zero assistance.

I decided to call again at 3:00am (11:00pm here in Alaska), but this time, I decided to try calling my AA Citi card and having them transfer me to the Costco department, as that worked well with zero hold time when I called last week.

The agent I spoke to said she would need to transfer me to "customer service" but kept coming back to say that they haven't answered yet due to heavy call volume, so after the third time, she said "Let me see if I can pull it up." Success: it showed up in her system and she was able to expedite me a new card to be delivered tomorrow (Tuesday). Total call time: 14 minutes. I'm sure I'd still be on hold if I called the Costco number.

So, if you have any questions about your Costco Anywhere Visa and you have another Citi card, use the number on the back of it to get through to an agent relatively immediately and see if they can help with the Costco card. The dedicated Costco line is absolutely swamped for now and probably will be for the near future...

jamesteroh

Has anyone had success buying a Costco cash card on Costco.com with their chase freedom card and getting the 5% bonus. I still have $1050 in open spending and need to get a gift card for the piano I talked about last week (bought it Friday and wrote a check and was told if I want to come back after July 1 I can use the gift card and put $1,500 on my chase freedom and balance on my PNC Cashback and they can cut me a check on the spot). I'd like to avoid making a special trip to Costco if I can but only if I am assured I'll get the 5% bonus back (I know I can only buy a $1K gift card online put can just do the other $50 for a restaurant gift card at Kroger).

I was told that if a non-Costco Am Ex refund was done they were giving the buyer the option of Costco Cash card, cash or a check. That made me think of the Jewelry thing that people were doing a while back, has me wondering if people made huge purchases on reward Am Ex cards like Delta and Hilton and will return them this week for cash and net a lot of free points in return (and FWIW I consider it unethical and would never do it).

loudbmw2

I made payment in full on June 19 to Costco AMEX. Successfully got to new Costco VISA account this morning which still shows the full statement balance due on 6/21/16 (tomorrow). Payment to AMEX did hit my checking account.

Phone lines are jammed - keep getting disconnected while on hold.