Costco deals with credit card problems
On June 20, Costco officially switched its retailer credit card from American Express (AmEx) to Visa, but while the company has been planning this for over a year, the transition has not gone smoothly. The company has almost 11 million credit card accounts that had to be transferred, a move that left many shoppers frustrated.
Instead of having an overlap period where customers could use either their AmEx TrueEarnings card or their Costco Anywhere Visa card, the company planned to do the switch within a day. June 19 was the final day that the AmEx cards were valid, but the Visa cards were not yet activated. On June 20, the Visa cards became valid while the AmEx cards expired.
However, a number of customers did not receive their Visa card by this date, while others were unable to activate the new card. Still others reported being unaware of the switch and did not realize they would need a new credit card. Richard Galanti, CFO of Costco, reported that as of June 23, only about two-thirds of the cardholders had activated their new cards. He estimated that some 180,000 did not receive their Visa card due to mailing errors.
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According to Costco, the issue led to longer wait times in store and required help from Citigroup, the bank that issued the Visa cards. A representative from Citigroup reported upwards of 1.5 million customer service calls regarding the issue.
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Originally Posted at: http://www.moneytips.com/costco-deals-with-credit-card-problems/178
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