Monday, May 24, 2021

The Top 5 Mastercard Cards to use at Costco Canada

 We've updated our feature on the Top Mastercard cards to use at Costco due to the recent changes to the BMO CashBack World Elite Mastercard. The BMO card saw its earn rate at Costco drop from 1.5% to 1% which meant it dropped off this list of the best five cards to use at Costco Canada stores. That card has been replaced with the WestJet RBC World Elite Mastercard and we've also added an honorable mention Mastercard to the list as well. The Top 5 Cards are as follows:

1. MBNA Rewards World Elite Mastercard - 1.67% to 2% return on Costco purchases

This card underwent some changes not too long ago that made it drop from being the best card to use at Costco to the second best but it came back after the best card (Rogers World Elite) was devalued. Ultimately it is the best when you redeem your MBNA Rewards points for travel. When you do you are earning a 2% return on your Costco and all other purchases. However if you redeem for cash back the rate is lower where you will earn a 1.67% return.

2. Brim World Elite Mastercard - 2% return on Costco purchases*

The Brim World Elite Mastercard has one of the highest returns for purchases at 2% but there is a reason we have that asterisk above. The 2% on the Brim World Elite Mastercard is limited to $25,000 in annual spending - not just at Costco. So if you spend more than this your rate of return drops to 1% on any spending over and above $25K so it will dilute your return over time. Add in a $199 annual fee and you get the picture as to why we don't actually place this card as the best one to use at Costco. Note this card does have the first year annual fee waived right now

3. HSBC World Elite Mastercard - 1.5% return on Costco purchases

The card itself will earn 3 HSBC Rewards points per dollar spent at Costco. Those 3 points equate to a 1.5% return towards any travel. On top of that the card has excellent benefits and insurance coverage plus right now it offers a welcome of up to 70,000 points and your first year annual fee rebated!

4. WestJet RBC World Elite Mastercard - 1.5% return on Costco purchases

This card has a base earn rate of 1.5% back in WestJet dollars which is equal to the HSBC World Elite Mastercard and the Rogers World Elite Mastercard. The reason why it falls in between the two is that the HSBC's card 1.5% can be used on WestJet flights but also on any other travel so it is more valuable in that regard. You could almost say the same thing about the Rogers card as it's 1.5% is more flexible but the Rogers card itself doesn't have as valuable of a welcome bonus like the WestJet nor the benefits that are afforded to the WestJet card like first checked bag free and an annual companion voucher.

5. Rogers World Elite Mastercard - 1.5% return on Costco purchases

This card used to be the number one card to use at Costco but it was devlaued on June 2, 2020. The old 1.75% earn rate at Costco has now dropped to 1.5% The Rogers card is a cash back card and you can redeem for cash back against a purchase once your rewards balance hits $20. The card doesn't have a huge sign up bonus but does provide a decent insurance package and best of all - it has no annual fee. 



Honorable Mention: MBNA Alaska Airlines World Elite Mastercard - variable return on Costco purchases

This card fits more of a niche market in the Canadian loyalty rewards landscape as its rewards are specific to Alaska Airline's Mileage Plan program. Points and miles aficionados know this card and this loyalty program well as it can provide some huge outsized value when utilized right for business or first class flights on airlines like Cathay Pacific and Japan Airlines. That outsized value can blow any of the above cards out of the water (think a 3, 5, or even 10% return) but like we said it's kind of a niche card that many Canadians just won't find the right value out of if they can't earn enough miles with the card.

Remember all of the above cards come with the latest Mastercard World Elite benefits

What about the Capital One® Platinum Mastercard® - Exclusively for Costco members

Although it isn't travel rewards related, the Capital One® Platinum Mastercard® - Exclusively for Costco members is a essentially a cash back card that replaced the True Earnings Card from Costco and American Express. While it has some great cash back earnings for non Costco purchases, you will in fact only earn 0.5% to 1% back on your actual spending at Costco which is less than other cash back or travel rewards credit cards so that is why this card doesn't factor in as one of the best Mastercard cards to use at Costco. On top of that Capital One ending its relationship with Costco and Hudson's Bay so we can expect this card to be nerfed sometime this year.

You also have the option of shopping with Costco online which opens it up to using a Visa card as takes both Mastercard and Visa or you can use a delivery service like Instacart and thus use a high earning American Express card like the Cobalt™ Card  to earn big time points on those deliveries.

Recommended reading: You can now use Instacart to circumvent Costco's non-acceptance of Amex and to earn 5x points with the Cobalt Card

Wrapping it up

Even if you have a Mastercard card that is not on this list but it earns rewards you are ahead of the game, it doesn't mean that your card is bad. It could very well be the right card for you or perhaps it is just OK and one of these will work better for you, especially if you spend a lot at Costco stores. You should also take into account all your other purchasing and loyalty program miles/points accumulation before applying for a new card or jumping ship from the card you currently have.

There are two other cards that are decent to use at Costco - the Capital One Aspire Travel World Elite Mastercard which provides a 1.5% return and the Diners Club Club Rewards Mastercard which provides a 1.5% return. The only issue with these two cards is that they aren't available for new applications. Only those people who currently have them can use them at Costco.

What do you think of this list? Are any of these cards in your wallet? If not are you apt to choose one of them or will you go with another Mastercard card?

Image via Costco

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