Costco has picked Visa as its new payment card network and Citigroup as the new issuer of its cobranded credit cards.

The membership warehouse retailer announced last month that it would move on from its cobranding deal with American Express, which has been the company's card partner for 16 years.  Amex said it could not come to an agreement with Costco, and it would rely on new technology initiatives to offset the loss of the retailer.

Amex faces other challenges, such as responding to its recent loss in an anti-trust case. It also recently raised rates for more than one million customers.   

Costco’s deal with Visa, announced Monday, hinges on Citigroup purchasing the existing co-brand portfolio. The banking giant will become the exclusive card issuer of Costco's cobranded cards while Visa will take over the network role previously enjoyed by American Express on April 1, 2016.

Costco said it will provide more details in coming months.

Subscribe Now

Authoritative analysis and perspective for every segment of the payments industry

14-Day Free Trial

Authoritative analysis and perspective for every segment of the industry