The Fine Print Behind The Costco Merchant Services Program



Similar to Sam’s Club merchant services, Costco offers merchant services to its members. Costco has good prices on bulk groceries and other items, but is it a good place to go if you are looking for a new Merchant Account? Maybe not. Read more to find out why.

Costco uses a company called Elavon, Inc. formerly NOVA, to provide their merchant processing services. NOVA Merchant Services changed their business name (much like other merchant services companies) because NOVA had too many "Ripoff Reports" and poor reviews about them. They changed their Business Name to Elavon a few years back.

Elvavon Inc. is a subsidiary of U.S. Bancorp. At first glance it appears that Costco has great rates – 1.38% and $.19 cents per card-swiped transaction.

When you look at the fine print on the Costco credit card processing page you will notice the following:

  • Rates listed are for qualified transactions
  •  A  Monthly Minimum charge may apply
  • A $25 Application Fee applies for Non-Executive Members
  • Rates and Fees may change without notice
  • This promotional offer is valid for a limited time
  • Additional Fees may apply in certain circumstances

After you read the fine print you might ask yourself, What am I getting myself into? If rates and fees can change, what am I actually committing to and for how long? Also, if the rates they quote are for “qualified transactions”, what is the rate that I will pay if the transaction is a rewards credit card for instance?

Costco offers Tiered pricing. At Dependable Solutions we only provide Interchange Plus pricing because it is most cost effective for merchants. 

Before enrolling in a Costco merchant account, ask them these questions:

  • How much is the Cancellation fee if I decide to cancel my merchant account early?
  • Will I pay a monthly PCI Fee? If so, how much?
  • Does my business qualify for the Visa “Emerging Market” Interchange rate?
  • Does Elavon pass the Durbin Amendment savings onto to the merchant?
  • Does Elavon have a way to pass Level 2 and Level 3 data for business-to-business transactions?

At Dependable Solutions, we focus on education to make sure you completely understand Interchange Plus pricing and all the different solutions available so you can make the right decision for your business. In addition, at Dependable Solutions we never lease a terminals. We only sell them at a fraction of the cost of leasing them or purchasing them directly from Costco.

If you would like to learn more about the solutions we offer, contact us today. 

Office: 717-806-5429