I recently saw @Yeni-Neo Costco tips and tricks thread, which got me thinking about a separate thing: would it be possible for Costco purchases to qualify for the grocery cashback category on the Neo World Elite Mastercard?
Currently, most grocery stores are recognized correctly, and even Walmart purchases qualify as grocery spending. For members who maintain the required balance in their Everyday Account, that means earning the boosted grocery cashback rate of up to 7%.
However, Costco is where many Canadians do a large portion of their grocery shopping. While Costco sells much more than groceries, many purchases consist primarily of food and household essentials.
The reason I bring this up is that we’ve already seen Neo improve transaction classification in other areas. Earlier this month, recurring payments that weren’t previously recognized started earning the proper recurring payment cashback. This suggests Neo can refine how transactions are categorized rather than relying solely on merchant codes.
That made me wonder if a similar approach could be explored for Costco.
I understand there may be technical limitations, but considering how popular Costco is among Canadian families, it would be great if Costco purchases could qualify for grocery cashback through improved merchant recognition or another solution.
I think this would be one of the most valuable cashback enhancements Neo could introduce.
I’m typically someone who doesn’t suggest or recommend things that often to friends and family simply to not seem pushy or offer advice they may not see the same value in. That said, if you could get between 5-7% at Costco with the WE mastercard, I would tell everyone I know.
I do believe this has been brought up before and its more so the deal that Mastercard and Costco have in place that make this not possible. But I had the same thought as you when the recurring payment format changed, maybe it can be done on Neo’s end. It’d be a game changer for sure.
I completely agree. Even the base grocery cashback rate of 5% would be a great start. For members who qualify for the cashback boost based on their Everyday Account balance, Costco purchases would be even more valuable. Given how many households spend at Costco, I think there would be a lot of interest in a feature like this.
That’s exactly what got me thinking about this as well.
I understand there may be Mastercard and Costco agreements in place, but we recently saw Neo improve how recurring payments are identified. Previously, many utility and bill payments didn’t earn recurring cashback due to their categorization, but that was eventually refined thanks to @GrantLahring_Neo and the whole team.
So it made me wonder whether a similar approach could be explored for Costco. If Neo can recognize certain transaction types beyond just the merchant code, perhaps Costco purchases could eventually be recognized differently as well. If that became possible, I agree it would be a real game-changer.
If we get enough support for it, we can do it. The challenge is that a solution that is expensive to Neo and/or vulnerable to friendly fraud isn’t sustainable long term and we might have to kill it or cut other things.
If it IS expensive, it has to draw lots of new customers so we can sustain the loss out of the marketing budget. Keep thinking of how we can make it work and maybe it will happen!
Thanks for the insight, Grant. I completely understand the concern around both cost and potential abuse. I’d much rather see a sustainable solution than one that has to be rolled back later.
One idea could be to introduce a monthly cap specifically for Costco purchases. For example, maybe the grocery cashback treatment could apply to the first $200 of Costco spending each month. That would give members some meaningful value while keeping the overall cost predictable for Neo and reducing the risk of abuse.
Personally, I spend around $600–$700 per month at Costco and currently use another card for those purchases because even a 2%–3% return is better than earning nothing in that category. If Neo offered grocery cashback on even the first $200 of Costco spending, I’d happily move that spending over.
It feels like a reasonable middle ground where members get a benefit, Neo keeps costs under control, and there’s no need to increase annual fees or introduce something that may not be sustainable long term.
If you’re getting 3% on Costco, you’re winning the game. Best I’ve seen is the flat cards that do 2%.
I think that’s a good way to increase value to the user. Whatever system we use, if we do that, just has to be simple so we’re not burning up support time explaining it to people.