Opinions And Ramblings By Adam Kmiec On All Things Media

“We Appreciate Your Business…” was the straw that broke the camel’s back today. That phrase was uttered to me by a Citi Credit Card representative as we were wrapping up our conversation regarding their decision to terminate my account because of “inactivity.” That was then followed up with, “…and would be more than happy to connect with you a representative who could assist you in applying for another card.” Huh? WTF?

OK, let’s go back to the beginning. Today, I received the following letter in the mail from Citi:

Dear Adam R. Kmiec:

A routine review of your account activity shows that you have not used your Citi Card accounting ending in XXX for an extended period of time. We are sorry if this card has not met your needs.

Due to prior inactivity, your account will be closed on December 28, 2009. As of that date, you will no longer be able to redeem and will lose any Extra Cash from Citi earned on your account. Please note, as we prepare to close your account, your credit line will be reduced to $100.00* on December 1, 2009.

Even if you use your card for purchases, cash advances, balance transfers, etc. we regret your account will be closed on December 28, 2009.

We appreciate your previous business, and if you have any questions regarding the closure of your account, please contact Customer Service at 1-800-950-5114.

Sincerely,

Kendall E. Stork
President and CEO
Citibank (South Dakota), N.A.

I was perplexed to say the least. I’ve been a Citi card holder for 8+ years and in truth I hadn’t used the card at all in the last 3 years. But, in those 8 years, I was a model credit card citizen. You know the type…I paid my balance every month, never missed a payment, asked for and received a limit increase, added my wife to the account after we got married, etc. So, being perplexed, I dialed the number they provided and asked for clarification. Here’s what I learned from Customer Service agent #1:

1. The letter was real
2. The decision is irreversible
3. Citi is concerned about potential fraudulent charges that could appear on my account (keep in mind there were no charges, real or fraudulent, in the last 3 years)
4. My card member agreement covers this, although she was unable to locate my current card member agreement
5. She apologizes for the inconvenience and would be happy to help me apply for a new card

Well, clearly we weren’t getting anywhere, so I asked to speak to someone else. She agreed. It must be noted that Customer Service agent #1 was very cordial and robotic.

So, we were on to Customer Service agony #2. She was clearly irritated that she had to talk to me. Here’s what I learned from Customer Service agent #2:

1. The letter was real
2. The decision is irreversible
3. My card member agreement covers this on page 10, where it clearly states that Citi my cancel my account for any reason whatsoever and without any notification
4. They are not required to notify me that this type of action could be forthcoming
5. She apologizes for the inconvenience and would be happy to help me apply for a new card

I, of course, asked the “dumb” question, “wouldn’t it take more time, effort, and money for you to run an application for a new card than it would to simply reinstate my current one?” The answer, was priceless, “I really can’t say, but the card member agreement is clear. We value your business.”

Um, you value my business so you are canceling my card? Shit, what do you to do people who’s business you don’t value? Do you send them anthrax in the mail?

I wasn’t irritated about losing the card, I’m a Discover card user primarily, but I was irritated at the principle of the situation. I turned to twitter to voice my irritation and learned the following from some good friends:

1. Because I pay my bills on time and/or don’t rack up any bills, Citi doesn’t ma any money off of me. OK, that makes sense. They aren’t scoring any extra cash on interest payments, because I’m a responsible customer. So if we treat this like a business, which it is, I’m not driving their bottom line as much as someone who racks up large bill and pays the minimum every month.
2. It’s easier for them to cut under/low utilized lines, than reduce lines from delinquents. In effect, they are punishing those who pay on time. This of course begs the questions, if you’re the guy paying the minimum every month, what’s the chances you’re ever going to pay things off in full and not have to deal with a collection’s company? In other words, in the short term, the month-by-monthers are worth more to Citi. But in the long run, when they basically can’t make the payment any more, fold/file for protection, aren’t they effectively a loss on the books?

My post isn’t to try and gain sympathy or start a Motrin Moms like mob mentality. Like I said, I hadn’t used the card in 3 years. This post is more about shining the light on 4 very specific things:

1. Companies continue to screw up communication. They don’t understand the importance of being proactive. Think how differently this might have played out if I received a letter indicating if I didn’t use my card in the next 30 days (you know the prime shopping season) it would be closed for lack of activity.
2. Companies continue to screw up the concept of a “value customer.” What’s that old rule, it cheeper to keep a customer than it is to get a new customer. You already have me as a customer. So, how does it make sense that you would terminate me and then have the balls to offer up the option of letting my reapply for a new card?
3. Companies still don’t understand context. I’m sure there was a business rule, based on amount of time since my last purchase, that automatically triggered the letter. But, dude, look at the context. You sent me the letter, indicating you were closing my account, on BLACK FRIDAY. It’s only the largest shopping day of the year.
4. Until consumers actually take a stance, we’ll be at the mercy of companies like Citi. Think about what the customer service agent told me about page 10 of my card member agreement; they could terminate my account for any reason whatsoever whenever they wanted. That’s not exactly a mutually beneficial relationship.

This was a totally bizarre experience. It’s one I hope you never have to go through. Perhaps my story will help you defend against the insane and arbitrary rules and practices credit card companies employ.