3 money-saving Costco credit card perks you might be missing

Costco treats credit cards differently compared to other retailers.

Most chains accept American Express, Visa, and Mastercard. Costco only works with one brand at a time.

For decades, that was American Express, but in 2016, the warehouse club switched to its current partner, Visa. Now, Costco has an official Visa with Citi, the Costco Anywhere Visa By Citi, but it also accepts other Visa-branded cards at checkout.

Members who get the Costco Anywhere card (and it's only available to members) get 5% cash back on gas purchased at Costco stations, 4% at other participating stations, 3% cash back on restaurants and travel, as well as 2% cash back on any purchases made at Costco or Costco.com, according to the company's website.

Getting cash back is the headline perk, but there are three others offered by the Citi card that even cardholders may not know about.

Costco's credit card is a mixed bag

A co-brand relationship, in which issuers typically add a merchant’s name and logo to a card, “gives you the ability, the scale, the access to clients and terrific partners, the ability to create sticky incentives,” former Citi CEO Mike Corbat said in 2016 at the time of the change.

Costco clearly is happy with the deal, even though it rarely comments on it. The warehouse club chain has signed an extension to the original 10-year agreement, according to SEC documents.

Costco's branded credit card works well for Costco power users, but it's not the best everyday use card on the market as it only offers 1% back on most purchases, while many cards offer 2%.

"With an earning rate of nearly 2 cents for every dollar you spend, the Costco Anywhere Visa stands out as one of the most lucrative no-annual-fee cash back cards on the market. But unlike many of its competitors, the Costco Anywhere card doesn’t offer a promotional APR. It also doesn’t offer as much flexibility," CreditCards.com wrote.

Not all opinions are as positive.

It’s rare that you find a voice of reason on Reddit, but CoopDude summed up Costco’s credit card problems well in a post on the social media site.

“The biggest problem with the Costco Visa is that it has a 1% everywhere earn rate. This means if you use it as your primary credit card — e.g., almost all or all of your spending goes on it — the 1% everywhere else drags on your effective cashback. If you look at the effective cashback that most people get when they post their yearly summaries on r/Costco, they usually average 1.5-1.8% effective cashback, and would have been better off using a 2%+ anywhere card,” they explained. 

Costco's credit card has hidden perks

The Costco website shared a number of perks its credit card holders may not realize they get. First, and this is an easy one to miss: The card has no annual fee.

Your Costco Anywhere Visa can also fill in for your membership card.

"The Costco Anywhere Visa Card doubles as your membership card, complete with your picture and membership number. Show the card at the warehouse entrance, then use it to check out at the register," the company posted.

It also has a key perk for members who travel.

"Adventure to Bora Bora, Japan, and beyond with your Costco Anywhere Visa Card. There’s no foreign transaction fees on purchases wherever Visa is accepted," the company shared.

Is the Costco Anywhere card a good value?

Reviews of the Costco Anywhere card are largely positive, but they all point out the same flaws.

"For a store card, the Costco Anywhere Visa® Card by Citi carries plenty of goodies in its cart. The card can indeed be used anywhere, not just at Costco, and it offers impressive rewards rates across a wide variety of categories. Its annual fee is $0," NerdWallet wrote.

There are, however, some negatives.

"You have to be a Costco member to get the card (or to realize any benefit from it), and that does require a yearly membership fee. And while the card’s rewards rates are generous in some categories, they aren't particularly high for in-store Costco purchases, and redemption isn’t straightforward," the site shared.

Rewards can be redeemed once a year and only at a physical Costco warehouse.

CNBC suggests that the Costco credit card is only right for some users.

"While the Costco Anywhere Visa Card is great for loyal Costco customers, if you typically shop at other stores or want to take advantage of more flexible rewards, you may want to consider another Visa credit card like the Wells Fargo Active Cash Card. Costco only accepts Visa-branded credit cards for in-store purchases, so they are the only potential alternatives to the Costco Anywhere card," the business news site shared.

Related: Costco shares good news as gas prices spike