Costco Wholesale Corp. customers have deluged the retailer’s Facebook page with hundreds of complaints about a new credit card from Citigroup Inc., saying they endured lengthy wait times and had trouble activating accounts.
Costco, the world’s largest wholesale club, told customers that the bank is working to deal with a spate of calls about the new Costco Anywhere Visa cards. The cards were available for use starting on Monday.
“Due to high levels of interest in the Costco Anywhere Card and high volumes of calls from cardholders, callers to Citi should expect longer-than-desired hold times,” Costco said on the Facebook page. “Citi is reviewing processes and pulling in additional resources to alleviate hold times.”
Costco decided last year to end its 16-year relationship with American Express Co. after the firms couldn’t agree on card fees. Costco’s sales have slowed in recent months, disappointing analysts. One reason could be “friction” from the credit-card switch, Scott Mushkin, an analyst at Wolfe Research, said in a note to clients this month.
One Costco customer said on the retailer’s Facebook page that she was on hold for three hours waiting to talk to a Citigroup representative. Another said that he was improperly billed for charges he already settled with AmEx. Dozens of customers posted that they still haven’t received their cards, and others said they were having trouble activating their accounts.
Jennifer Bombardier, a spokeswoman for New York-based Citigroup, apologized to customers who were inconvenienced. She said Citigroup had issued 11 million of the cards and received 1.5 million customer calls by late Wednesday.
“Some customers experienced delays reaching customer service,” Bombardier said in an e-mailed statement. “Call volumes are starting to return to normal and we are working diligently to meet their needs. In addition to phone service representatives, we also provide online activation.”
Marina Norville, a spokeswoman for Amex, said the company has received calls from Costco customers and they’re directing them to Citigroup representatives.
The situation should be “manageable," said Michael Lasser, an analyst with UBS Group AG. Most of the 25 stores UBS called said they were having only isolated issues with the cards, he said, adding that the retailer has set up booths in stores to provide temporary cards to customers who haven’t received one.
“While the mild disruption suggests June sales expectations should be held in check, these issues should be resolved rather quickly," Lasser said in a note to clients.