Walmart is firing back at Costco with new cash rewards

AP

Walmart is rolling out new cash-back rewards for its credit and prepaid cards.

The retailer's cards — the Walmart MasterCard, Walmart credit card, and prepaid MoneyCards — will now offer 3% back on purchases made on Walmart.com, 2% back on fuel purchases at Walmart or Murphy USA gas stations, and 1% back on purchases at Walmart stores and everywhere else, the company announced Thursday.

The company is calling the upgrades the "3-2-1 save program."

The cards had previously offered only two ongoing rewards: $5 back for every $500 spent and a discount of $0.05 per gallon on fuel purchased at Walmart gas stations.

The upgrades, which go into effect on April 1, come as rival Costco improves its own credit-card rewards.

The new Costco credit card, managed by Visa, will launch June 20.

The Costco card will offer 4% cash back on eligible gas purchases (on up to $7,000 per year, then 1% back), 3% back on restaurant and travel purchases, 2% back on Costco and Costco.com purchases, and 1% back everywhere else.

There is no annual fee for the card, but shoppers must pay for a $55 annual Costco membership to use it.

Walmart also has a separate credit card for Sam's Club members.

The Sam's Club MasterCard offers 5% cash back on fuel purchases (on up to $6,000 per year, then 1% back), 3% back on restaurant and travel purchases, and 1% cash back on other purchases. Customers can earn a maximum of $5,000 in cash-back rewards annually. 

"We’re always looking for ways we can create and change products and services to make them even better for our customers,” Daniel Eckert, senior vice president of services for Walmart US, said in a statement. “The new 3-2-1 save program simplifies and strengthens the card proposition for more than 10 million cardholders and helps add even more value to their Walmart purchases no matter how they choose to shop with us."

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