Most retail chains offer customers ways to save more money. That usually comes at a price,
Costco (COST) For example, it is offering its Executive membership at double the price of its basic Gold membership. After its recent price increase, that means people will pay $130 for the top-tier membership that comes with 2% cash back up to $1,250.
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It's a good deal if you shop regularly at the wholesale chain store, especially since you don't need to have a branded credit card. Most discount programs involve more than just being a loyal customer.
At Target (TGT) But that's not quite the case. You do get some rewards just for signing up for the Target Circle program. Those rewards have gotten a little vaguer since the chain dropped the direct cash back portion of the program.
However, in most cases, the biggest rewards go to people who sign up for a branded credit card. In Target's case, cardholders get a very significant discount.
“You'll receive 5% off purchases paid for with your Target Circle Card (debit, credit and reloadable) at Target stores and Target.com, excluding CVS prescriptions and other pharmacy products; Target GiftCards; Visa, Mastercard and American Express prepaid cards,” the retailer shared on its website.
amazon.com (amazon.com) Chase offers a similar deal with its credit cards. Members get 3% off most purchases and 5% off if they're also Prime members.
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Walmart ends its credit card deal
Walmart (WMT) I had a branded credit card with Capital One (COF) That agreement ended on May 24. However, at that time the two companies had allowed existing customers to keep their discounts at the retail chain.
“While Capital One and Walmart have ended their card partnership, nothing changes today for cardholders: Cardholders can continue to earn and redeem rewards, and previously accrued rewards will retain their value. Until otherwise notified, cardholders can also continue to use their Capital One Rewards® Card anywhere Mastercard is accepted and the Rewards Card for purchases at Walmart.”
Walmart shared similar news that day.
“The partnership between Capital One and Walmart has ended. Capital One Walmart Rewards is no longer accepting applications. Existing cardholders can continue to use their card and earn 5% cash back on Walmart.com purchases until otherwise notified by Capital One,” Walmart shared on its website.
That agreement has now ended and Capital One shared a new notice for its Walmart credit card holders.
“The partnership between Capital One and Walmart® is ending and we will no longer be able to offer the Capital One Walmart Rewards Card and the Walmart Rewards Card. For eligible customers who currently have one of these cards, we are pleased to inform you that your card will be replaced with a Capital One Quicksilver Mastercard,” the bank said.
Capital One Quicksilver cardholders do not get any specific offers at Walmart.
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Costco, Target and amazon have an advantage
Walmart seems likely to add a new credit card partner. However, it doesn't have one for now. That gives it an advantage over amazon, Costco and Target (which all have lucrative credit card deals for their members).
If you can get a store-branded credit card that comes with a discount at a specific retailer, that can drive a consumer to become a customer of that chain.
The end of Walmart's deal with Capital One was unpleasant because the retailer sued the bank to get out of the agreement.
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Walmart sued Capital One in April 2023, seeking to end its credit card partnership with the McLean, Virginia-based lender.
“Walmart alleged that Capital One repeatedly breached various contractual obligations under the card association.” RetailDive reported.
These included “promptly issuing replacement cards to customers, as well as processing their payments and posting transactions to their accounts in a timely manner.”
By canceling its branded credit cards, Walmart has ceded an advantage to its main rivals, which offer credit cards that grant discounts to their members. Walmart has not commented on any possible new credit card partnerships.
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