Credit card companies might not be all the same, but they have to work hard to differentiate themselves to customers. Consumers might not understand the finer points of what separates Visa from American Express, but they do have an understanding of which card gives them more perks.
Credit card companies team up with other companies to offer new perks all the time. Hotels and airlines are the standards that most people probably think of, but in an effort to reach new customers and keep existing ones happy, cards are always looking for new partners. Recently, American Express teamed up with Hertz Car Rentals to offer more perks, including a status upgrade that could allow them to skip the line.
But while credit card companies may need to constantly roll out new perks, not all of these partnerships work out, and now customers of Costco (COST) – Get Free Report and CitiBank (CTBK) are going to lose a very helpful perk.
What Costco Benefit Is Going Away?
Stuff breaks, all the time. Maybe your refrigerator’s internal motor shorts out, maybe your cat jumped on your flatscreen TV and brought the whole thing crashing down. But everything is ultimately fragile; such is the nature of life.
Most major purchases come with an option to buy a warranty, so you can get a refund or an exchange if your washing machine or whatever breaks within a year. The cost of a warranty will vary depending on the product, the store, and many other factors, but experts say you should never pay for a warranty that costs 30% more than the price of the good you’re purchasing.
For a while, the Costco Anywhere Visa Card by Citi and Costco Anywhere Visa Business Card by Citi offered free extended warranty protection, adding 24 months to manufacturers’ warranties, up to a seven-year total coverage limit, as noted by The Points Guy.
But as many Reddit users have noticed, this benefit will end for both cards on January 22nd of next year. Any Costco purchases that qualify for the extended warranty made before that date will still get the warranty, but that won’t be the case for anything purchased after January 22nd. If you purchased something several years ago, your warranty still stands.
In a memo that made its way to Reddit, and that you can also find if you log into your Citi account, the company noted that “We are making these changes so that we can continue providing the key benefits that our customers use and value most at no additional cost.” So it’s unclear why exactly this benefit is ending, but the most likely reason is budgetary cuts due to inflation or other economic pressures.
Citi Has Cut Benefits Before
This isn’t the first time Citi has cut a benefit.
In 2019, the company removed a great deal of benefits from its cards, including the CitiBusiness AAdvantage Platinum Mastercard. Extended Warranty, Purchase Protection, MasterCoverage, Lost Baggage Protection, Travel Accident Insurance & Medical Protection, and many other benefits were shown the door.
The Costco card continued to have the Warranty benefit, but nothing lasts forever.
Costco, unlike other retailers, Costco does not accept all credit cards. It only takes Visa and does not accept American Express, or MasterCard. Customers can use debit cards tied to MasterCard, but they must use them for pin-based transactions.
Read More: Costco’s Credit Card Changes in a Way You Won’t Like