Walmart customers are losing a key way to save money — all because of a dispute between the world’s largest retailer and Capital One.
In 2019, the Virginia-based bank became the sole issuer of Walmart’s two store credit cards, offering lucrative 5 percent cash back on the retailer’s website and 2 percent on items purchased in-store.
In May 2024, Walmart ended the partnership after it accused Capital One of failing to replace lost credit cards in a timely manner and failing to update cardholders’ accounts.
Initially, customers were told they could use the cards and claim their cashback, until Capital One told them otherwise.
But now Capital One has said it will soon replace those cards with a new card, the Quicksilver Mastercard, which doesn’t offer Walmart’s benefits.
Walmart accused Capital One of negligence in its credit card partnership. A federal judge sided with Walmart in March 2024
Capital One is rated just 1 star out of 5 based on more than 1,600 reviews filed with the Better Business Bureau. It has closed 12,969 complaints in the past three years
The dispute between the two giants led to a lawsuit that began in April 2023 and ended in March 2024, with Walmart emerging as the winner.
District Judge Katherine Polk Failla ruled that Capital One was indeed liable for “repeated customer service failures‘, giving Walmart the right to terminate the partnership under their mutually agreed upon contract.
As a result, we are no longer accepting applications for the Capital One Walmart Rewards Mastercard, which can be used anywhere Mastercard is accepted, and the Walmart Rewards Card, which is only available in physical stores.
But because Capital One still owns the credit accounts linked to these now-defunct Walmart cards, the bank opted to shrewdly transfer them to its own Quicksilver Mastercard.
According to court documents, Capital One estimates the balances in these accounts to be about $8.5 billion. The plan to issue new cards will allow the company to continue making money from those who use those cards.
Eligible customers will receive a replacement Quicksilver card with no annual fee “on an ongoing basis,” so not all customers will receive their card at the same time, according to Capital One’s website.
The Quicksilver card is a no-frills offering that gives 1.5 percent cash back on almost every purchase. There are no annual fees and no foreign transaction fees.
A spokesperson for the bank said NerdWallet Walmart cardholders can expect to receive their new card in the mail no later than September or early 2025.
Both Walmart cards remain active and can still be used, but once customers receive the replacement card, Capital One recommends activating the new card and destroying their old card.
Any points you earn with the Walmart cards will be transferred to the Quicksilver card at a value of one cent per point.
Of course, you can’t get 5 percent off at Walmart stores with the Quicksilver card, but you do get 1.5 percent unlimited cash back.
That’s more than the 1 percent unlimited cash back that the Capital One Walmart Card offered in its heyday, but most people don’t use store credit cards for off-premise purchases.
Walmart is now in the unique position of not currently having its own credit card for its customers.
There are two debit cards that entitle you to 3 percent cashback and a reloadable Visa debit card through Green Dot Bank.
The supermarket chain has not yet announced what its plans are for the future credit card market.