Citi's Costco Card Is On The Way

(RTTNews) - Citigroup Inc. (C) said that the new "Costco Anywhere Visa Card" will be mailed by it, beginning in May. The new card will replace the co-branded Costco credit card from American Express Co. (AXP).

In late February, American Express said it entered into an agreement to sell its Costco U.S. co-branded card portfolio to Citigroup. At that time, the company noted that the sale is expected to close in June 2016, at which time all eligible Costco American Express Card co-branded accounts will be transferred to Citigroup.

Citigroup has launched a website with information about the Costco Anywhere Visa Card by Citi. The company said it will send the full terms and conditions, along with payment due dates and interest rates, along with the new card.

The company noted that a card holder need not apply for the new Costco Anywhere Visa credit card and can continue to use the Costco Card from American Express until June 19, 2016.

The card holder can begin using the new card on June 20, 2016 and destroy the old card. The company has urged customers to visit citi.com/CostcoSetup to register their account for online access.

The new card does not have carry an annual fee, but a customer will be required to pay his annual Costco membership.

Anyone currently paying their membership fee through automatic payments with their American Express card will automatically be allowed to do so with the Citi version of the card. The new Citi card will serve as the cardholder's Costco membership card.

Regarding the rewards and benefits, Citi's new Costco card allows eligible card holders to earn 4 percent cash back on gas purchases of the first $7,000 per year and then 1 percent thereafter; 3 percent cash back at restaurants and on eligible travel purchases, 2 percent back on all purchases from Costco and Costco.com, and 1 percent cash back on all other purchases.

This is an improvement from the American Express card that provided 3 percent cash back on gas up to $4,000 per year, 2 percent cash back on restaurants and eligible travel, and 1 percent on other purchases.

Further, Citigroup said it will not pull a credit report as part of the account transfer process.

Card holders will also not lose any of the cash back they have accrued with their American Express Costco card. Rewards that were not previously distributed to a card holder will be transferred automatically to his new card on June 20, 2016.

Account balances will also be transferred over to the new Visa cards by the June 20 start date. Citigroup said monthly payments should be directed to whichever issuer the card holder receives a statement from.