Costco CIBC Mastercard

If you’re reading this, looks like you’re curious about the new Costco CIBC Mastercard and here I am, being the master of all Costco fans, I’m giving you my breakdown and what I think about this new credit card.

The History

On March 4, 2022, the new CIBC Costco Mastercard officially rolls out, taking over Capital One Mastercard after they took over American Express (AMEX) back in 2014.  Honestly, switching from AMEX to Mastercard is a big game changer for Costco due that more people have Mastercard and more merchant widely accepted then AMEX was.  This switch actually push me to sign up to Costco because any Mastercard is accepted at Costco.

However, the offering that Costco Capital One Mastercard exclusive was really lack luster.  I don’t know the details why, but what I heard that they are making little or no interchange fees (they take a percentage of the sale) for purchase within Costco.  Plus, on the top side of things, you can use any Mastercard at Costco and most people already have a Mastercard, which maybe have  better rewards or even equal to what Capital One was offering, so there is no incentive to sign up for a new Mastercard.

Either case, goodbye Capital One, it was fun while it is lasted.

As many news outlet and post have been circulating for weeks, current Capital One Costco Mastercard holders don’t need to do anything, they are automatically roll into the new CIBC Costco Mastercard.  You will have to wait until the new CIBC card to comes in and you will get a final statement for your Capital One.   You just have to fellow the instruction that they sent you and be patience.  It’s gonna take time to get it all set up.

For everyone else, as of March 14, 2022, you can now sign up for the new CIBC Costco Mastercard, either in-stores or online…  You can sign up right here…

https://www.cibc.com/en/personal-banking/credit-cards/all-credit-cards/costco-mastercard.html

There is actually 2 versions, the regular Costco CIBC Mastercard and if you qualify, the Costco CIBC World Mastercard, which give you a little extra perk then a regular Mastercard.  I couldn’t find the information on the CIBC page what perks they are, but if it is like any other World Mastercard, you will get travel perks, such as car rental insurance and all that.

https://www.mastercard.ca/en-ca/personal/find-a-card/world-elite.html

What’s new?

So, you want to know what’s new?  What is the difference to what was Capital One offering?   First, right off the bat, no more up to 1% cash back, as you need to spend more then 3000$ to get the full 1% cash back.  Now, you get a flat rate of 1% cash back regardless where Mastercard is accepted, that included all your Costco warehouse purchase.

The same 2% cash back any gas station fuel will remains, but in addition to that, you if you love ordering from Costco.ca, you will get 2% cash back for those purchases.  This is perfect for those special items that is exclusively online only.  I’m not sure you will get 2% on the annual renewal online, but I guess we will find out when my renewal comes into effect.

Last, if you love to eat out, the 3% cash back for restaurants remains the same.  But there is more.  Now, exclusive to Costco gas stations, you get 3%, too.  So not only you will save on pumping at Costco gas station (cheaper sometimes up to 10 cents), you get an extra 1% cash back, too.

Beside the rewards, there is a benefits of the credit card as well.  There is the “Mobile Device Insurance”, so any upcoming renewal of your phone purchase, especially when you purchase a new phone at the Costco phone kiosk, great to have.  Though, I would read the terms and conditions very carefully, as other credit card do have similar benefits, but they are very strict.

Mobile Device Insurance provides repair or replacement coverage up to $1,000 for your personal mobile device such as your cell phone, smartphone or tablet in the event of loss, theft or accidental damage (drops, cracks or spills) for up to two years following your new mobile phone purchase.

Also, like any other Mastercard, you get also Purchase Security (90 days) and Extended Warranty Insurance (up to an additional year).

Purchase Security provides worldwide coverage in the event of loss, theft or damage of qualified purchases charged to an eligible CIBC card.  If the item is stolen or damaged it may be replaced or repaired, or we may reimburse you up to the original cost of the item.

Extended Warranty Insurance benefit provides cardholders with an extension to the term of the original manufacturer’s warranty. This extension is up to a maximum of one additional full year, commencing at the expiry of the manufacturer’s original warranty term. Please note, the manufacturer’s warranty must be honoured in Canada or the U.S, and items must be charged to your eligible CIBC card.

Since it’s with CIBC, they have an easy to use app for your phone that makes things easy to managed and get statements and so forth.  If you have a banking account with them, it is also easier to make payments as well.

Of course, no annual fee.  Well, beside the Costco membership…

There are other benefits, too, but I wouldn’t use them as it carries a fee.  It might be useful for large Costco purchase, there is an installment payment plan.  The interest are reasonable and being a Costco membership, the installment fee (1.5% of the total) is waived. 

However, remember, having a credit card is also having a good responsibility using it.  To maximize the full benefits of a credit card, you have to pay it in full.  No interest, no fees, nothing.  That’s my advice, but that’s another story to tell.  Back to topic…

You can read it in more details right here…

The downside?

 I’m not sure if it is a downside, but the cash back isn’t really money you can spend somewhere else.  It is actually a Costco gift certificate that you will get.  You will only be able to spend it at a Costco and only at a Costco, according to what I read.  Also, it is redeem once a year.  Also, since it is a gift certificate, are we able to cash it like the Executive Costco 2% Cash Back membership holders?  After all, for those who are Executive Costco actually send you a check, you can technically cash it out if you buy something cheap and pay with it, they usually give you the rest in cash.  Right now, no idea.  It just started so I guess we will see.  

It might be an offset as other cash back credit card out there can redeem your cash back anytime, either a credit on your statement to cash that you can deposit at your bank.  So, it depends how you want to your cash back.  If you want to have a bonus at the end of the year, great.  Others, I don’t mind having that option to cash out anytime when I really need the extra help time to time.

Also, you must remain a Costco member to claim any benefits of the card, so like the extended warranty, if you cancelled your Costco membership, you will lost that benefit, even there is time left as your CIBC Costco Mastercard will be also cancelled.

The no…

Last note, whatever you do, DO NOT sign up for the creditor insurance.  You might accidently opt in, make sure to say no thank you and even they give you a trial, do not accept it.  If you accidently sign up for it, just call and cancelled.  Not sure, you will see a small charge, it varies per month as it is base what you purchase.  Make sure to be careful.  This insurance is not free and not even worth it…  Check out CBC Marketplace story on this on the link below…

Conclusion…

So, that’s my analysis and comments on the new CIBC Costco Mastercard.  I think it is a huge improvement over the Capital One.  If you don’t have any other cash back credit card and shop a lot at Costco, this might be for you.  If you have an existing credit card that already give you a 1% cash back, that depends on your needs.  Remember, you can only cash the cash back at Costco only and it is once a year.  Also, if you shop often online at Costco.ca, you get 2% purhcase and gas up at Costco and eat out alot for the 3%, it’s a win for getting the card.

  • 1% cash back on all purchases, including all Costco warehouse purchases.
  • 2% cash back on gas stations and 2% Costco.ca purchases
  • 3% cash back on restaurants and Costco gas station (exclusive).

For me, I’m gonna sign up and use this card only exclusive at Costco purchases to actually make it easier to see how much I really spend at Costco.  The 3% perk for the gas is also a bonus with the current gas prices.  Every penny counts.  See you at Costco…

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Update: March 14, 2022