This is the Costco card for the business side of your life. It keeps the personal CIBC Costco Mastercard's $0 fee and 3% at restaurants and Costco gas, and adds 2% on shipping, insurance services and Costcobusinesscentre.ca, which are real business costs. Up to 9 employee cards are free, each with its own spending limit.
The limits are what I'd watch. Every boosted category stops at $8,000 a year, the cash back comes once a year as a Costco-only gift certificate, and the account is personal liability, so the balance is yours as well as the business's. For a small business that already lives at Costco, I think it is an easy yes; for one that spends heavily elsewhere, the caps arrive quickly.
Welcome offer
The welcome offer is a $100 statement credit once $3,000 in net purchases posts within 120 days of opening the account. That works out to about $750 a month, which a business that restocks at Costco should clear easily. CIBC prints no end date.
The credit lands 6 to 8 weeks after the last qualifying purchase posts, and the account must be in good standing with an active Costco membership at that point. It is for newly opened Costco Business Mastercard accounts only, one per account; cash advances, balance transfers, fees and convenience cheques do not count toward the spend.
Put a quarter's worth of recurring costs (shipping, insurance premiums, Costco restocking) on the card in the first 120 days and the $3,000 takes care of itself while those purchases earn their 2% or 3% too.
Fees & eligibility
The card has no annual fee, and up to 9 Authorized Users cost $0 too, though the primary cardholder and every Authorized User need their own active Costco membership. CIBC asks for a $15,000 individual minimum annual income, and the card has a minimum credit limit of $1,000.
This is a personal-liability business card: the primary applicant must be a signing officer of the business and qualifies on personal credit, and the primary cardholder and the business are jointly and severally liable for the balance. The purchase rate is 20.75% and cash is 22.49% (21.99% in Quebec), with a 21-day grace period on purchases and a 2.5% foreign currency conversion fee.
Earning rewards
The card earns 3% at restaurants and Costco gas, 2% in four business-friendly categories, and 1% on everything else, including purchases inside Costco warehouses. Each boosted category earns its higher rate only on the first $8,000 of net purchases a year, then drops to 1% until the limits reset on January 1.
Redeeming rewards
Cash back is paid once a year: each January, the Primary Cardholder gets a Costco gift certificate for everything earned in the previous calendar year. You can redeem it digitally through the CIBC Mobile Banking App or print it, but only once, and only at the front-end registers of Canadian Costco warehouses.
That rules out Costco gas, Costco.ca, Costcobusinesscentre.ca, food courts, pharmacies, travel, alcohol and tobacco. The account must be in good standing and the Costco membership active on December 31, or the year's cash back is lost, and closing the account forfeits whatever has built up. Authorized Users cannot receive or redeem certificates.
Perks & benefits
The most useful perk for a business is control over employee cards. You can add up to 9 Authorized Users at no cost and set separate purchase and cash limits for each one, and their charges are grouped by user on a single monthly statement. The card also doubles as your Costco membership card.
CIBC Pace It installment plans on eligible Costco purchases, including Costco.ca and Costcobusinesscentre.ca, run at 5.99% for 6 months, 6.99% for 12 months or 7.99% for 24 months with no installment fees. Linking the card to Skip gets you a free Skip+ membership. There is no lounge access, no travel benefit and no foreign transaction fee waiver.
Insurance
Coverage is limited to purchases and phones, under a Belair certificate written for this card. Mobile Device Insurance covers a new phone or tablet bought on the card (or financed through a carrier plan paid with it) for up to $1,000 per claim for 2 years, based on depreciated value less a 10% deductible, and limited to one claim per 12 months across all CIBC cards.
Purchase Security covers most new items for 90 days against loss, theft or damage, and Extended Warranty doubles the manufacturer's warranty by up to 1 extra year, with a $60,000 total limit per cardholder across all CIBC cards. There is no travel medical, trip, baggage, rental car or accident coverage.
My take
I'd get this card if your business already buys at Costco and spends on meals, shipping or insurance; I'd skip it if you need travel insurance or want cash back you can spend anywhere.
For a $0 card, I like the categories a lot. Shipping and insurance premiums are costs most small businesses carry, and 2% on them with no annual fee is a nice touch. The $8,000 limit per category does cap the upside: at full use, each 3% category is worth $240 a year and each 2% category $160.
Compared with the personal CIBC Costco Mastercard, this one has a lower 20.75% purchase rate, a higher $8,000 gas limit, the extra business categories, 9 free employee cards and a $100 welcome bonus. The trade is business paperwork, personal liability for company spending, and a limit on restaurant earning. If you hold the personal card already, one Costco membership covers both.
The good
- No annual fee and up to 9 free employee cards with spending limits
- 2% on shipping, insurance services and Costcobusinesscentre.ca
- $100 welcome bonus for $3,000 in 120 days
The catch
- Every boosted category stops at $8,000 a year
- Cash back paid once a year as a Costco-only certificate, lost if you close the account
- Personal liability, 2.5% FX fee and no travel insurance