@UncleB wrote:
@yfan wrote:
@14Fiesta wrote:Can we talk for a minute on how exactly Citi plans to make money on this portfolio? If you remember, they are going to be getting less than 1% in swipe fees at Costco. That means that on everyday Costco purchases, they are losing around 1.5% per transaction. If you look at gas transactions at Costco, they would be losing around 3.5% per transaction. How exactly is this conducive to profit? Is Citi expecting 90% of their cardholders to be revolvers?
It's possible that some of the rewards are covered by Costco and/or Visa and not Citi. Visa may be covering some because Costco will now accept all Visa credit cards, which means they will make up the difference on non-cobranded Visa swipe fees. And I remember hearing wearhouse purchases costing Costco less than 1%, but it's likely gas station swipes are more.
But besides for people who carry balances, I think the main way Citi would be making money is by making the Costco card your default card for everything everywhere, not just at Costco. They cover the top 3 categories for a Costco shopper with basically no compeition: gas, restaurant/travel, and Costco purchases. I think a lot of people will find that it's the main (or even the only) card they are going to use for everyday use.
+1
I can say that with very similar rewards the Sam's Club MC has become my 'daily' go-to card, and I agree that many folks with the new Costco Visa will probably be the same way with it.
Actually, I now use my Sam's Club MasterCard for pretty much everything except for groceries (BCP) and whatever is currently covered by Discover's changing quarterly categories. I suspect this will be the 'norm' with holders of the new Costco card as well.
I imagine that is is one of the motivating factors for why Citi upped the rewards on the card: exactly so people would use it as as their everyday card and Citi would earn swipe fees, etc. outside of Costco where they won't be making much of anything off the swipe fees.
@chally wrote:
@FinStar wrote:I believe I read that as well plus some folks have reported they can't make any other changes (CLI, reallocations) to their current TE cards, which makes sense. Thank goodness the last CLI on mine was done at the end of last year!
Late to the thread...I opened a new BCE last night, same CL and APR as TE. Was told by New Accounts that I could freely reallocate from the TE till the March 29 cut off date.
Any pro's or con's to reallocating say, 11k Citi (TE) 25k BCE or better to have 2 larger CL? BCE and TE are both 18k, my highest limits (next highest is FNBO 6.7k). Lol, the stuff we obsess about!
Thanks for the March 29 date, though it sucks for me. I have:
$15k BCE (was BCP but downgraded when I switched to MRs) (got it 3/31/15 IIRC)
$15k EDP (got it 9/15)
$3600 TE
The TE was $4200 but when I got a crappy limit on my EDP I moved $3k over, and have since done a 3x on the EDP, and I recently got a 3x auto CLI on the TE so at least I've got that. But I was hoping to up it before it headed to Citi. However neither other card will be old enough to be a donor card by 3/29. And I'm due for the next 3x on something like 4/4. So looks like my Citi Costco Visa will be stuck at $3600. 
@Anonymous wrote:
@chally wrote:
@FinStar wrote:I believe I read that as well plus some folks have reported they can't make any other changes (CLI, reallocations) to their current TE cards, which makes sense. Thank goodness the last CLI on mine was done at the end of last year!
Late to the thread...I opened a new BCE last night, same CL and APR as TE. Was told by New Accounts that I could freely reallocate from the TE till the March 29 cut off date.
Any pro's or con's to reallocating say, 11k Citi (TE) 25k BCE or better to have 2 larger CL? BCE and TE are both 18k, my highest limits (next highest is FNBO 6.7k). Lol, the stuff we obsess about!
Thanks for the March 29 date, though it sucks for me. I have:
$15k BCE (was BCP but downgraded when I switched to MRs) (got it 3/31/15 IIRC)
$15k EDP (got it 9/15)
$3600 TE
The TE was $4200 but when I got a crappy limit on my EDP I moved $3k over, and have since done a 3x on the EDP, and I recently got a 3x auto CLI on the TE so at least I've got that. But I was hoping to up it before it headed to Citi. However neither other card will be old enough to be a donor card by 3/29. And I'm due for the next 3x on something like 4/4. So looks like my Citi Costco Visa will be stuck at $3600.
Yup March 29.....also don't know if I should move or not. Will probably keep it the same to ensure I get a $10k limit on the citi card.
