Wal-mart is firing back at Costco with new cash rewards

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

The retailer's cards — the Wal-mart MasterCard, Wal-mart credit card, and prepaid MoneyCards — will now offer 3% back on purchases made on Walmart.com, 2% back on fuel purchases at Wal-mart or Murphy USA gas stations, and 1% back on purchases at Wal-mart 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 Wal-mart 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.

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Wal-mart is firing back at Costco with new cash rewards
Richard Branson, founder of the Virgin Group, center, Virgin Cruises CEO Tom McAlpin, left, and Miami-Dade County Mayor Carlos Gimenez, right, pose for photos, Tuesday, June 23, 2015, at Perez Art Museum in Miami. Branson and McAlpin announced that Virgin Cruises will set sail from PortMiami in 2020. (AP Photo/Alan Diaz)
Richard Branson, founder of the Virgin Group, arrives, Tuesday, June 23, 2015, at Perez Art Museum in Miami. Branson and McAlpin announced that Virgin Cruises will set sail from PortMiami in 2020. (AP Photo/Alan Diaz)
Richard Branson, founder of the Virgin Group, right, and Virgin Cruises CEO Tom McAlpin, left, place the Virgin Cruises flag at their arrival, Tuesday, June 23, 2015, at Perez Art Museum in Miami. Branson and McAlpin announced that Virgin Cruises will set sail from PortMiami in 2020. (AP Photo/Alan Diaz)
Richard Branson, founder of the Virgin Group, arrives, Tuesday, June 23, 2015, at Perez Art Museum in Miami. Branson and McAlpin announced that Virgin Cruises will set sail from PortMiami in 2020. (AP Photo/Alan Diaz)
Virgin Racing Team owner Sir Richard Branson talks to reporters during a news conference at the Formula E Miami ePrix auto race in Miami, Saturday, March 14, 2015. The race features a of 10 teams of two drivers racing electric powered open-wheel Formula cars. (AP Photo/Alan Diaz)
Richard Branson speaks on stage during We Day UK at Wembley Arena, in west London, Thursday, March 5, 2015. With 12,000 students and teachers in attendance from more than 550 schools, We Day celebrates the potential of young people to implement local and global changes. (Photo by Joel Ryan/Invision/AP)
Sir Richard Branson arrives for We Day at Wembley Arena in west London, Friday, March 7, 2014. Organized by international charity and educational partner, Free The Children, We Day is now a global event. Over 160,000 youths will come together in stadium gatherings to take part in an unprecedented educational initiative which inspires students to get involved in positive social change. (Photo by Joel Ryan/Invision/AP Images)
In this video grabbed image, billionaire Virgin Galactic founder Richard Branson, pauses before a news conference in which he saluted the bravery of test pilots, and vowed to find out what caused the crash of his prototype space tourism rocket that killed one crew member and injured another in Mojave, Calif., Saturday, Nov. 1, 2014. Virgin Galactic's SpaceShipTwo blew apart about 20 miles (32 kilometers) from the Mojave airfield after being released from a carrier aircraft Friday. (AP Photo/Scott Fain)
British entrepreneur Richard Branson, right, watches the match between Serena Williams, of the United States, and Maria Sharapova, of Russia, at the Sony Open Tennis tournament in Key Biscayne, Fla., Thursday, March 27, 2014. (AP Photo/Alan Diaz)
British entrepreneur Richard Branson speaks to some 300 would-be space tourists, who have paid some or all of the $250,000 fare up front, at a gathering in a Virgin Galactic hangar at Mojave Air and Space Port in Mojave, Calif., Wednesday, Sept. 25, 2013. Potential space tourists gathered in California's Mojave Desert to see the latest progress from Branson's space tourism enterprise. The company has been testing SpaceShipTwo designed to take paying passengers into space. Commercial flights will begin once testing is complete. (AP Photo/Reed Saxon)
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Wal-mart 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 Wal-mart purchases no matter how they choose to shop with us."

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