Best Buy Co., the worlds largest electronics retailer, is switching its credit-card processing partner to Visa Inc. from MasterCard Inc., according to two people briefed on the matter.
The change will take effect next year, said one of the people, who requested anonymity because the deal hasnt been made public. Citigroup Inc. will remain the card-issuing bank, the people said.
Visa agreed to terms to move a significant consumer credit co-brand from a competitor to Visa, Chief Executive Officer Charles W. Scharf said in an Oct. 29 conference call without naming the new partner.
Best Buy started its rewards-card partnership with Purchase, New York-based MasterCard in 2006. HSBC Holdings Plc, the original issuing bank, sold its U.S. card business to McLean, Virginia-based Capital One Financial Corp. in 2011.
Citigroup agreed last year to take over the Best Buy cards from Capital One, giving the New York-based bank a loan portfolio valued at about $7 billion at the time.
MasterCards Jim Issokson said the firm wouldnt comment on a rumor, adding that it has won other partnerships with retailers including Target Corp. and Wal-Mart Stores Inc.
Best Buy, based in Richfield, Minnesota, declined to comment, as did Paul Cohen, a spokesman for Foster City, California-based Visa.