Alice and Bob were doing some shopping at Costco in the United States. Bob is Costco member, and Alice isn't not. The cashier, citing Costco's policy, refused to accept Alice's credit card: Alice was told that non-Costco members can only use cash and debit card. Only Costco members may use a credit card a means of payment.

Why would Costco refuse credit card payments from non-Costco members? I'm trying to understand if this is related to fraud protection, credit card fee reduction, or something else.

  • 2
    Are you sure? Their webpage explicitly says you have to be a current member to pay by check (for obvious fraud reasons) but it doesn't have the same caveat for Visa card. I seem to remember paying on somebody else's membership back in the Amex days without any issue.
    – user71659
    Mar 11 '19 at 22:56
  • @user71659 Thanks, I don't know about check; Bob only tried checks. Same here, I also remember paying on somebody else's membership back in the Amex days without any issue. The casher's manager did confirm that Costco refuse credit card payments from non-Costco members, which seems to contradict the website. Mar 11 '19 at 23:00
  • Are Alice and Bob together? Was Alice trying to pay for Bob's purchase? Or is Alice on her own trying to purchase something that non-members are allowed to purchase, such as alcohol?
    – TTT
    Mar 11 '19 at 23:30
  • @TTT Alice and Bob were together. Alice was trying to pay for Bob's purchase. Mar 11 '19 at 23:38
  • 1
    This seems like it could be an error, or maybe just an individual store policy (though it is rare that such a big chain would institute such a store-level policy as this). If it weren't an error, it would seem to me to be an attempt to reduce the likelihood of charge-backs in any way they can manage, as this can be a major problem in some regions more than others; it may be legally difficult to go after member Bob for Alice's bad payment, but that's just conjecture on my part.
    – BrianH
    Mar 12 '19 at 1:07

I suspect it's to discourage excessive use of somebody else's account as a guest. They want to sell more memberships instead of having one person let many people into the warehouse.

I lived in a college town with a Costco and they had a policy there that they'd take one payment and receipt per cart or member. Therefore, roommates or friends using guest privileges, which was very common, would have to reconcile the purchases and payment later.

Outside this college town, I haven't noticed them enforcing this policy, like when I ask them for a separate receipt for business purchases.

Amazon Prime did something similar when they changed the Prime guest policy to require sharing the same address and payment methods.


Potentially because credit card payments cost them money, and if you are a member, you basically pay those back through your annual fee. For non-members, there is not enough margin left to cover those additional cost.


Costco's whole business model relies on membership. Costco wants you to be a member so Costco makes things difficult for non-members.

  • If it were just this, they could just as easily say “no cards at all” or charge a non-member fee.
    – Bobson
    Mar 12 '19 at 22:42
  • 1
    Coincidentally, there is a non-member fee, it so happens to exactly equal the annual membership fee. Costco wants you to be a member.
    – quid
    Mar 12 '19 at 22:43

I believe Costco only accepts Visa cards. They offer a Visa card with enhanced membership, and I strongly suspect that part of the deal, for bringing many thousands of new accounts to Visa, is that the usual merchant fees for people who use that card are greatly reduced or waived for Costco purchases.

  • Also it is beneficial for costco since the merchant fee is dropped considerably: rd.com/advice/saving-money/why-costco-only-accepts-visa
    – CamelBlues
    Mar 13 '19 at 2:16
  • Merchants fees are what the acquiring bank charges the merchant. The money the issuing bank gets is the interchange. They are related (the acquiring bank generally passes on the interchange to the merchant as part of the merchant fee), but different. Mar 13 '19 at 17:39

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