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Credit card customers of Citibank have filed a relatively high volume of complaints about unfair treatment from the bank, CNN Business reports. The bank accounted for approximately 37%, or 168, of the 456 pandemic-related complaints to regulators about credit cards between March 16 and May 20, per analysis of the Consumer Financial Protection Bureau (CFPB) complaints database conducted by Consumer Reports and cited by CNN — four times as many as the next-closest bank, Synchrony Bank (40).
Complaints concerned topics including inflexible late fees and interest charges, as well as refusals to provide assistance to customers dealing with financial hardships as a result of the coronavirus pandemic. Citi issued a statement opining that Consumer Reports "grossly misrepresented" how Citi has supported its customers and claiming that complaints referenced in the CFPB database "include those related to merchant disputes, as well as those received very early in the crisis just prior to credit card assistance being available." It also noted that many of the merchant disputes were related to travel cancellations.
As the coronavirus crisis took hold in the US, major banks deployed a wide range of measures to protect clients' health and finances. Banks have stepped up to ease the burden on customers by offering mortgage forbearance, credit card payment deferment, waived fees, and educational resources about how to use digital tools while branches were closed. And it's worth noting that Citi was communicating to clients that it was offering credit card payment deferments among its relief measures as of mid-May, per Insider Intelligence analysis of banks' public websites and marketing and public relations materials.
The volume of complaints against Citi are small relative to its overall customer base, but Consumer Report's findings still illustrate how customer service missteps can be magnified in times of crisis. Citi pointed out in its statement that the 168 complaints referenced by Consumer Reports represents a miniscule fraction of the 1.9 million customers it has assisted during the coronavirus crisis.
While this means that potential fallout in terms of customer attrition for Citi should be minimal, it still highlights a reputational risk of not treading lightly when it comes to assisting clients during a crisis. By practicing lenience toward struggling customers, banks can drive up customer loyalty and positive word of mouth for their brand while also drawing approval from regulators like the CFPB and Federal Reserve.
Failing to accommodate customers in need will yield the opposite effect: serious customer dissatisfaction, negative media attention, and the ire — and potentially increased future scrutiny — of regulatory bodies that are relying on banks to help during the coronavirus crisis.
Clarification: We have updated this item with additional context from Citi about the content of customer complaints. (June 26, 2020)
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