If you‘re a savvy Costco shopper always on the hunt for a good deal, you may be wondering if the superstore accepts "buy now, pay later" options like Afterpay. These services have exploded in popularity recently, allowing customers to purchase items immediately and pay them off in installments over time.
So, can you flash your Afterpay account at checkout to pay for that gigantic pack of paper towels or 5 lb tub of mayonnaise? I dug into Costco‘s payment policies to get you the definitive answer. I‘ll explain exactly which buy now, pay later choices Costco does accept, how they compare to Afterpay, and share some insider tips for using these financing options wisely.
What Is Afterpay and How Does It Work?
First, let‘s make sure we‘re all on the same page about Afterpay. This service allows you to split any purchase into 4 interest-free installments paid over 6 weeks. You pay the first 25% at the time of purchase, then the remaining 3 installments of 25% each are automatically charged to your linked payment method every 2 weeks.
Afterpay doesn‘t require a credit check and there are no long application forms. You can sign up instantly at checkout with just a few pieces of info. This makes it an attractive option for those with lower credit scores or anyone who wants to avoid the temptation of racking up credit card debt.
However, Afterpay is only available from participating retailers – it‘s not something you can use anywhere. Thousands of popular stores accept Afterpay, but what about Costco? On to the million dollar question…
Does Costco Accept Afterpay?
I‘m sorry to be the bearer of bad news, bargain hunters, but no, Costco does not currently accept Afterpay as a form of payment. You can‘t use Afterpay for purchases in Costco stores, on Costco.com, or through the Costco app.
This applies to all Costco purchases, including regular buys from the shelves, big ticket items like furniture and appliances, gas, Costco travel, and even food court favorites like their famous $1.50 hot dog and drink combo. Put simply, Afterpay and Costco just don‘t mix.
Why Doesn‘t Costco Accept Afterpay?
You might be wondering why the heck Costco would choose not to accept such a popular payment method, especially one that encourages people to spend more. While the company hasn‘t issued any public statements explaining the decision, there are a few potential reasons.
Costco‘s business model is all about keeping prices as low as possible for its members. They achieve this through bulk buying, streamlined operations, and cutting out middlemen. Accepting a service like Afterpay means losing a small percentage of each sale to Afterpay processing fees, which could ultimately translate to higher prices.
Costco also has a bit of a fraught history with payment processing, having cut ties with American Express after 15+ years in 2016 and switched to only accepting Visa. The company seems hesitant to take on additional payment partners, perhaps not wanting to further complicate the checkout process or risk customer confusion.
Costco also tends to have an older customer base compared to some retailers. These shoppers may be less familiar with or interested in newer digital payment options like Afterpay. They likely prefer to stick with tried-and-true methods like credit cards and cash.
What Buy Now, Pay Later Options Does Costco Accept?
While Afterpay is a no-go at Costco, the retailer does accept a different buy now, pay later service called Zip (previously Quadpay). Like Afterpay, Zip allows you to split your purchase into 4 interest-free installments paid over 6 weeks.
However, there are a few key differences. Unlike Afterpay, you can use Zip anywhere that accepts Visa payments, including Costco. With Zip, you‘re actually applying for a short-term loan and Zip issues you a unique virtual Visa card number to complete each purchase.
To use Zip at Costco, you first need to download the Zip app and create an account. Then you can either browse and check out directly through the Zip marketplace, or use the virtual card to pay on Costco.com or in the Costco app. Currently, you can‘t use Zip in-store at Costco.
Your first payment is due at the time of purchase and the remaining 3 are automatically charged to your linked debit or credit card every 2 weeks. Zip doesn‘t charge any interest or fees as long as you pay on time.
One thing to note – Costco has a $1,000 limit on purchases made with Zip. This likely isn‘t an issue for most day-to-day Costco trips, but could affect big ticket buys.
What Other Payment Options Does Costco Accept?
In addition to Zip, Costco accepts the following payment methods:
- All Visa credit cards
- Costco Anywhere Visa Card by Citi (offers cash back on Costco purchases)
- Most PIN-based debit/ATM cards
- Costco Shop Cards (gift cards)
- Mobile payment options like Apple Pay, Google Pay, Samsung Pay
- Cash
- Personal checks from Costco members
- Business checks from Costco members
- Traveler‘s checks
- EBT cards (in-store only)
Of course, you‘ll need to flash that trusty Costco membership card no matter what payment method you use! Unfortunately, Costco doesn‘t accept Mastercard, Discover, or American Express except for online purchases of Costco Travel.
Tips for Using Buy Now, Pay Later at Costco
While buy now, pay later options like Zip can seem tempting for large Costco hauls, it‘s important to spend responsibly to avoid overextending yourself. Only charge what you know you can afford to pay off within the installment period. Keep track of your scheduled payments and make sure you have sufficient funds in your linked account to cover them.
If you‘re new to buy now, pay later, I recommend starting small with just one or two purchases until you get the hang of it. Resist the urge to go wild and split every purchase just because you can – having multiple open installment plans can quickly get overwhelming!
Also remember that items paid for with Zip are subject to Costco‘s return policy. You‘ll need to process any returns or exchanges through Costco, not Zip. Even if you return something, you‘re still obligated to pay your remaining Zip installments on time.
The Bottom Line on Costco and Afterpay
While it would be convenient to have Afterpay as a payment option at Costco, the wholesale giant has chosen not to jump on this particular buy now, pay later bandwagon. However, the availability of Zip gives Costco shoppers a similar option to spread out payments over time.
Costco also accepts a wide variety of other payment methods, so you shouldn‘t have any trouble checking out with your preferred card or mobile wallet. And of course, good old cash is always king at Costco!
Will Costco change its tune and start accepting Afterpay in the future? Never say never, but it seems unlikely given the company‘s resistance so far. I think Costco shoppers are better off exploring other buy now, pay later services like Zip or opting for a traditional Visa credit card to earn rewards on those bulk buys.
I hope this guide has helped demystify the Buy now pay later options at Costco! Let me know in the comments if you have any other questions about payments or financing your Costco purchases. Happy shopping!