The Future of the Costco Anywhere Card

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Every so often, a flurry of speculation sweeps through the points-and-miles world. The latest? That the Costco Anywhere Visa® Card by Citi is headed for big changes—maybe even a new issuer—when the current Costco/Citi/Visa deal ends in 2026.

But here’s the thing: this card’s appeal goes well beyond the usual points-and-miles crowd. It’s a favorite among everyday Costco shoppers, including plenty of people who have never earned a single travel award point in their lives, because of its strong cash-back categories and the fact that it’s free for Costco members.

Except… It’s not about to change hands.

A Quick Look Back

In 2016, Costco made a huge move: it ended its exclusive relationship with American Express and switched to Visa, with Citi issuing the new co-branded Costco Anywhere Card (AP News). While it wasn’t widely publicized at the time, industry chatter suggested the agreement was for 10 years. That timeline—2016 through 2026—is why so many rumors have cropped up lately.

And to be fair, there’s a reason people are interested. Since 2016, Citi has stripped away nearly all of the travel and purchase protections the card once offered. The final major perk, extended warranty coverage, disappeared in January 2023. Add in the card’s once-a-year cash-back redemption process, and it’s not hard to see why members have mixed feelings.

The Reality: The Deal Already Got Extended

According to SEC filings, Costco has already exercised its right to extend the initial term by three years:

“Costco hereby exercises its right pursuant to Section 12.01(a) to extend the Initial Term by three years. Therefore, the parties acknowledge that the Initial Term will continue through June 19, 2029.”

That means Citi and Visa will remain Costco’s partners until 2029, another three years beyond the original 2026 end date. In other words, there’s no imminent shake-up in who issues or processes the card.

Why Costco Might Not Be in a Hurry to Make Changes

Even if customers aren’t as enamored with the Costco Anywhere Card as they once were, the current arrangement is very good for Costco. Thanks to terms negotiated in 2015, the company pays near-zero interchange fees on in-warehouse Visa transactions—a cost largely subsidized by Citi and Visa. This applies even to non-Citi Visa purchases at Costco.

From a business standpoint, that’s hard to walk away from.

But Changes Can Still Happen

An extension to 2029 doesn’t mean the card’s structure is frozen. In fact, Citi recently:

• Increased Costco Gas earnings to 5% (from 4%)
• Added EV charging to the gas category

Those are positive tweaks, but the most common complaints haven’t been addressed:

• 1% back on most purchases outside bonus categories
• Once-a-year redemption (voucher for paper statements or code for digital statements), usable only at a Costco warehouse
• No purchase or travel protections

The Competition Has Caught Up

Back in 2016, few Visa cards offered 2% cash back on everything, so 1% outside Costco’s bonus categories didn’t seem bad. Today, it’s a different story:

• There are multiple no-annual-fee Visa cards earning 2% everywhere (we’ve covered them here).
• Cards like the Capital One Venture X earn 2× points on everything, which can beat 2% depending on redemption strategy.

In this market, the Costco card’s base rate feels dated.

Looking Ahead

With the current agreement in place until mid-2029, Costco, Citi, and Visa have plenty of time to work out the next phase of their partnership—or for Costco to explore other issuers.

Would American Express want to get back together after their 2016 breakup? Or have they already moved on with Walmart as their new dance partner?

For now, the “Costco is about to switch issuers” buzz is just that—buzz. The real story is that the core deal is locked in for another three and a half years, and while tweaks to the rewards structure can happen, any seismic change to who issues the card is years away.

Final Thought

The Costco Anywhere Visa® Card remains a strong earner in certain categories, especially for gas, EV charging, dining, travel, and Costco purchases. But with slim protections, once-a-year redemption, and a lackluster 1% base rate, it’s no longer the slam-dunk it was in 2016. Whether you keep it or look elsewhere will come down to how much you value those bonus categories—and how patient you are waiting for your rewards.

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This post first appeared on Your Mileage May Vary