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Costco strikes credit card deal with Citi, Visa

"Clearly if you have a retailer with the size and scope of Costco and you have the exclusive card, you know that is a very important relationship," businessman Warren Buffett said of the deal.

By Danielle Haynes
Citigroup and Visa have inked a new deal with Costco to replace the one the retailer previously had with American Express. File photo by John Angelillo/UPI
Citigroup and Visa have inked a new deal with Costco to replace the one the retailer previously had with American Express. File photo by John Angelillo/UPI | License Photo

ISSAQUAH, Wash., March 2 (UPI) -- A little more than two weeks after ending its relationship with American Express Co., Costco Wholesale Corp. announced a new partnership with Citigroup Inc. and Visa on Monday.

American Express had previously been Costco's sole credit card provider, but the retailer announced its decision not to continue accepting American Express or issuing its credit cards through the company in mid-February after failing to come to an agreement on a new contract.

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Citigroup will now replace American Express as the exclusive issuer for Costco's credit cards in the United States and Puerto Rico. Starting April 1, 2016, all transactions will be processed by Visa Inc. and Costco will only accept Visa cards at its retail locations.

Businessman Warren Buffett told CNBC he didn't think "Citi will get rich off" the deal but the relationship between the two is significant.

"Clearly if you have a retailer with the size and scope of Costco and you have the exclusive card, you know that is a very important relationship," he said.

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