The Most Expensive Five-Cent MasterCard Bill in History

Case Study in how not to do customer service...

My mother recently received a Citibank MasterCard bill for five cents. No, that's not a typo. The bill, which arrived via US Mail was for five cents, as in one single solitary nickel.

Her first thought was this must be a mistake. Then she realized what happened: She had gone to the automated postage machine at the post office to buy stamps when the postage rate increased last month. The machine took only credit cards. She swiped a credit card and attempted to buy several types of stamps, starting with five one-cent stamps to cover the new rate. The problem was the post office machine only allowed one purchase per credit card swipe, so she took her five one cent stamps and left, rather than spend all day at the machine generating multiple small transactions to get her stamps.

Fast forward to this week. A MasterCard bill arrives with this single five cent transaction on it. She calls Citibank where one of those paid-to-read-the-screen, not-to-have-an-original-thought call center representatives tells her she must pay the five cent bill by the due date, there are no options. The account rep does tell her that yes, there is another transaction that will appear on the following month's bill, however it is not acceptable to wait until the following month's billing to pay this month's five cent charge together with next month's charge. If she does this, the account will be considered overdue and both interest and late fees will apply. (Most credit card late fees start at $29/month; some are even higher.) Furthermore, in this age of subprime mortgage crisis, if her payment is late, her account will be reported as delinquent.

A long conversation ensued in a futile attempt to convince the rep how ridiculous this is (not to mention how costly to the credit card company as well as to the consumer). Still no luck. Finally, my mother says, fine, if that's the way you insist on treating me, cancel the credit card.I have plenty of others I can use.  Immediately, the rep's attitude changes and she transfers her to someone in card retention.

The next conversation goes something like this:

Card Retention Rep: I see you have been a card holder with us for over 22 years.
My Mother: That's correct. And you can also see I always pay my account on time, which is why I think you should just wait till next month for the five-cent charge.
CRR: I'm sorry ma'am. We can't do that. [Sort of reminds you of the computer HAL in 2001: A Space Odyssey, doesn't it?]
Mom: I don't understand why. It obviously cost you more than 5 cents to generate the bill, it will cost me more than that to mail the check, and it will cost you more than that to process and deposit the check. Why can't you add this to the following month's bill?
CRR: It's not in our policy.
Mom: Well, like I told the last rep,  your policy is pretty stupid. It is costing both you and me money so why don't you just cancel my card.
CRR: We really don't want you to cancel your card. Maybe I can look into this. Can you call back next week?
Mom: Why? What will be different then?

As of now, the situation is unresolved. In the meantime, Citibank has spent a ton of money on bill processing, payment and call center resources, a long-time cardholder is mad as hell and not willing to take it anymore, and, as mistreated and frustrated customers usually do, she is telling everyone she knows about this ridiculous situation. And, I, in turn, am telling you. All for a lousy five cents, which is less than 1/8th the cost of a first class stamp to begin with.

Here's how I see it:

Cost of five one-cent stamps                                                                                                                                           $.05
Cost to process statement for five cent balance                                                                                                   Several dollars at least
Cost for Citibank Master Card to mail statement for five cent balance                                                     $ .42 (slightly less if bulk mail)
Cost of toll free number and at least two call center resources tied up for over an hour on this call                          $100? Maybe more

Cost to Citibank MasterCard of alienating a long-term customer and propagating this stupidity through the blogosphere...          PRICELESS.

Comments

[Clara]

Your reinterpretation of the MasterCard advertisement is hilarious! But maybe it could have gone on the top before the actual story. It's the one thing that really got my attention.

[chasingcreditcards]

This story is an eye opener. I hope citibank already resolved the matter.