Many small business owners know that their local Costco store can offer better prices than some of their other suppliers, especially when factoring in the 2% rewards offered to Costco’s Business Executive members. Better yet, you can combine these low prices with the best rewards that you can earn from your small business credit cards.
What you need to know about using credit cards at Costco
Most major retailers accept any credit card that’s part of the Visa, Mastercard, American Express or Discover payment networks. However, Costco is different. For many years, American Express was the only credit card accepted by Costco, and it also offered a co-branded credit card. But this changed in 2016 when Costco’s partnership with Amex ended, and Visa became its exclusive credit card partner. Now, you can’t use American Express cards in Costco stores, only Visa cards.
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While nearly every retailer that accepts Visa also accepts Mastercard, Costco stores still don’t accept Mastercard or Discover credit cards. However, you can use your Mastercard or Discover cards for purchases made online at Costco.com. Other forms of payment accepted by Costco include debit cards, checks, cash and Costco Cash gift cards.
Here are three of the top small business credit cards that you can use at Costco:
Costco Anywhere Visa Business Card by Citi
This is the obvious choice for small businesses to use when shopping at Costco, and it’s the only small business credit card to offer bonus rewards at Costco. This card features 4% cash back on eligible gas purchases worldwide, including at Costco stores. However, this rate of cash back is limited to your first $7,000 in spending each calendar year, and you’ll only receive 1% cash back after that.
You also receive 3% cash back at restaurants and on eligible travel purchases worldwide. When shopping at Costco and Costco.com, you’ll earn 2% cash back, and 1% is earned from all other purchases.Your rewards will be received in your February billing statement as a Costco Cash certificate. You can redeem these certificates for cash or merchandise at any U.S. Costco store.
Benefits include damage and theft protection, extended warranty coverage, and worldwide car rental insurance. This card offers new applicants seven months of 0% APR financing on new purchases, followed by a standard interest rate of 16.24%, variable. There’s no annual fee for your card for paid Costco members, but there is a 3% foreign transaction fee imposed on all charges processed outside of the United States.
Spark Cash from Capital One
Instead of featuring additional cash for purchases at Costco, the Spark Cash card from Capital One offers a high level of rewards for all purchases. This small business card offers new customers a $500 cash bonus when you make $4,500 in new purchases within three months of account opening.
It also features unlimited 2% cash back on all purchases, with no minimum to redeem. This is the same amount cash back that the Costco Anywhere Visa Business from Citi offers for purchases at Costco (other than gas and travel), and more than it offers on most other purchases. Other benefits include purchase security and extended warranty policies. There’s an annual fee of for this card, and no foreign transaction fees.
Spark Cash Select from Capital One
One of the nice things about the Costco Anywhere Visa Business Card by Citi is that it has no annual fee. It’s closest competitor that also has no annual fee is the Spark Cash Select from Capital One. It offers 1.5% cash back on all purchases, with no limits. This is more than the 1% offered by the Costco Anywhere card on most purchases, but less than it is at Costco. New cardholders can also receive a $200 cash bonus once they spend $3,000 on new purchases within three months of account opening. New customers also receive nine months of 0% APR financing on new purchases. There’s no annual fee for this card, and no foreign transaction fees.
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