Costco Merchant Services Review

Overall Rating Breakdown
Sales & Marketing Tactics
Costs & Contract Terms
Complaints & Service

Costco Merchant Services

"B" Credit Card Processor Rating

Last Updated: February 18, 2014
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Costco Merchant Services Overview

Costco Logo

Costco Logo

Costco Merchant Services ( is the merchant services division of Costco, a well-known wholesale retailer. Costco Merchant Services is actually a reseller of Elavon contracts, and this relationship is indicated clearly on the department’s website. This means that businesses who sign up for a merchant account through Costco will receive the processing services of Elavon. Costco Merchant Services offers debit and credit card processing, electronic check service, prepaid and gift cards, sales reporting, and POS terminals and software. Founded in 1976, Costco’s headquarters are located at 999 Lake Dr Ste 200, Issaquah, Washington 98027-8982.

Costco Sales & Marketing Tactics | B-

Costco appears to market its merchant services in the same way that it markets its other products, including mailed, online, and in-store promotion. The company’s large membership base allows it to market directly to its regular shoppers, sparing it the need to employ independent sales agents like its processor, Elavon.

The Costco Merchant Services website prominently quotes two rates. These rates are the “Qualified” rates for swiped and keyed transactions. The fine print beneath these quotes explains that rewards cards (which receive “Mid-Qualified” and “Non-Qualified” rates) will process at a higher rate, but it does not list these higher rates. We consider this type of rate quoting to be somewhat deceptive, since merchants who overlook or misunderstand the fine print could have an unrealistic expectation of the rates they will pay. We have not lowered Costco’s rating too severely, however, because the fine print does explain that it is only showing the Qualified rates.

Coscto also offers a member-exclusive service called “Clear and Simple Pricing,” in which Costco members receive flat rates for all swiped (2.49%) and keyed (3.49% + $0.15) transactions. The fine print states that Costco will waive the $25 application fee and $4.95 statement fee for its Executive level members.

Costco Costs & Contract Terms | C+

As noted above, Costco resells Elavon contracts, which suggests that Costco’s standard contract terms likely resemble the standard Elavon contract. These terms appear to include a three-year agreement with a cancellation fee averaging $250, monthly minimum fees of $20, and a monthly statement fee of $4.95. Additionally, the company’s rate structure is roughly average for the industry. Costco’s involvement doesn’t appear to add or subtract much from the usual services offered by Elavon, with the lone exception of its members-only “Clear and Simple Pricing” plan. These factors compel us to award Costco a “C+” in this category.

Costco Complaints & Service | B+

We were able to locate only two Costco Merchant Services reviews publicly filed on this and other consumer protection site. One complaint mentions poor rates, difficulty cancelling the service, and an undisclosed early termination fee. The other describes an expensive equipment lease and difficulty replacing a stolen terminal. It is important to note that because Costco’s Merchant Services department is a part of Costco and resells the services of Elavon, it is very likely that many merchant complaints get funneled to the customer service departments and online profiles of these other two entities. Given Elavon’s average track record with complaints and the sheer size of Costco, it’s nearly impossible to chart whether merchants are complaining about Costco’s Merchant Services. Overall, though, merchants do not appear to accuse Costco Merchant Services of being a scam or ripoff.

Costco BBB Report | N/A

The Better Business Bureau does not have a page devoted specifically to Costco Merchant Services, and Costco itself has had its complaints distributed across multiple profiles for its individual locations. In addition, it’s possible that some Costco Merchant Services complaints could be redirected to Elavon’s BBB profile. It would therefore be unhelpful to consult the BBB for information about Costco’s Merchant Services, and we will not factor the BBB into this review.

Bottom Line

According to our criteria, Costco Merchant Services rates as an above average merchant account provider. As a reseller of Elavon contracts, Costco shows a lower complaint rate than Elavon and offers some mild additional value that its processor does not. The company’s rating was lowered because Elavon does not rate as an exceptional provider by our standards, and it is difficult to chart the complaints that might be filed against Costco. Merchants are advised in general to read their contracts carefully.

Leave your review of Costco Merchant Services in the comment section below:

Costco Merchant Services Review

Rated 3.16666666667 Out of 5 Stars
Reviewed by Phillip Parker
Reviewed on 2014-02-18 14:07:46

UPDATED: Feb 18, 2014 – We were unable to locate any Costco Merchant Services reviews that accuse the company of being a scam or ripoff… Costco Merchant Services ( rates as an above average merchant account provider. As a reseller of Elavon contracts, Costco shows a lower complaint rate than Elavon and offers some mild additional value that its processor does not. Learn more in this Costco Merchant Services review.

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About the author

Phillip Parker

Phillip Parker is a former merchant services agent turned small business advocate and the author of "Fee Sweep," which teaches merchants how to dramatically lower their processing rates, eliminate junk fees, and avoid fine-print scams. He founded to help merchants enact positive change in the credit card processing industry.

Phillip can help you find an ethical and honest processor that will offer you great rates. Click here to request a free provider consultation.

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1 comment

  1. SD

    Elavon is a rip-off….

    Everything looks good in the beginning with the low rates but look out !!! I had a terminal stolen, and Elavon wants $1226 to replace it !! How you ask… Elavon is asking me to buy out the full term of my contract as well as pay for the terminal to rectify this, and them start over with a new contract right away. They will not just sell me a new terminal to replace the old (3months) terminal and allow me to carry on business as usual. And they think this is alright and I will be happy to just go right back to them. They are smoking something down there.

    Stay awayfrom them.

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