Costco Wholesale Corp. (COST), the largest U.S. warehouse-club chain, will stop accepting all American Express Co. (AXP) cards in Canada on Jan. 1 after a breakdown in negotiations between the two companies.
“The credit card relationship between American Express and Costco Wholesale Canada will not be renewed when it expires on Dec. 31,” Lorelle Gilpin, vice president of marketing and membership for Costco Wholesale Canada, said yesterday in an e-mail to Canadian customers.
AmEx, the biggest U.S. credit-card issuer by purchases, was the only credit card accepted at Costco stores, and has worked with the warehouse-club chain to issue co-branded cards. U.S. stores will continue to accept AmEx, with the exception of TrueEarnings and American Express Platinum Cash Rebate cards issued in Canada.
“The terms of the contract was up, AmEx and Costco entered into negotiations and were unable to come to terms,” David Barnes, a spokesman for AmEx in Canada, said in a phone interview. “This is very specific and exclusive to Canada. There are separate contracts for AmEx’s U.S. Costco relationship.”
Costco will still be offering a credit card and has signed a new agreement with Capital One. The Capital One Platinum MasterCard will serve as both a credit card and a Costco membership card and this change means that Costco will accept all Mastercard credit cards in their stores – not just Costco branded cards.