Banana Republic Credit Card Comes With Free Account Errors, Late Fees, Disconnected Calls

Nick went shopping recently at Banana Republic and applied for a store credit card. Now he’s being called by a collections department and receiving contradictory stories about whether or not the retailer has his correct address on file.

After reading his story below, you might want to remember that if you apply for a store credit card, it’s possible your purchase at the time you apply will be charged to it. This is why you also want to always reconcile your bank statement with your debit purchases.

I recently moved and started a new job, and went to Banana Republic to buy some work clothes. In late June, I purchased about $100 worth of clothing, and was offered a large discount if I applied for a Banana Republic card. I did so, and left the store. Today, I received a call from Banana Republic collections claiming that I was behind on card payments, and owe $112.78. I had not received the card, a bill, a phone call, or any other indication that the card was approved and active until that call. According to the card service company, the card was mailed (to my correct address) on June 4th, and my first statement was issued June 21st. I have seen neither of these documents.

The first person I spoke with quoted my correct address to me, and agreed to waive the additional fees that had been added to my account, but informed me that my purchase of $87.78 remained on the account. My debit card was swiped at the point of sale, but the salesperson did not charge the purchase to my debit card, rather applying it to my not-yet-approved credit card. I do not recall being informed of this significant bit of information. I asked to pay the amount over the phone and close the card, but was told that I’d be forced to pay a $15 fee to pay by phone. I asked to speak to management. When transferred, the call mysteriously dropped.

The second person I spoke with, again in the first tier, claimed that my address had been entered incorrectly, directly contradicting the previous representative, and that my card and statement had been returned to them by the postal service. She offered to close my account for a minimum payment and send a final bill to my address, which they claim will arrive on August 29th.

After all of this, I did some cursory research into Banana Republic’s credit cards and discovered that my experience was not only common, it seems almost to be systematized – others report similar situations where they receive no information and no bills, then are called by collections and told that they are a month or two past due and that late fees have been added to their account. Similarly, many people find that attempting to move beyond tier-1 support leads to mysterious dropped calls. I was luckier than most I’ve read about in that I managed to have all extra charges removed from my account, but I still feel as though an attempted scam was barely foiled.

I would warn anyone thinking of a BR store card to steer clear. Even if there is no malice at work, there certainly is gross incompetence.

Is it system-wide? There are some interesting complaints out there about Banana Republic’s credit cards, and all of them concern problems with billing addresses or account errors. But the volume of complaints for Banana Republic cards is low compared to some of the Internet’s more famous bad companies.

At any rate, it’s better not to agree on the spur of the moment to apply for a store credit card. If you’re committed to getting one, stop by the cashier on your way into the store and pick up a copy of the terms and conditions, so you know what you’re getting into before the cashier hits you up with a discount offer.

“Banana Republic Complaints – credit card fraud” [Complaints Board]
“Banana Republic Complaints – Terrible company!” [Complaints Board]
“Jonathan of Queens, NY March 24, 2010″ [Consumer Affairs]

Comments

Edit Your Comment

  1. Loias supports harsher punishments against corporations says:

    G/f worked in a lot of retail – management pushes these pretty hard on the reps in the stores.

    My personal opinion is that the harder management tries to (up)sell you on any particular product, the less likely the sale would benefit you, the consumer.

    • sleze69 says:

      Who still uses store credit cards?

      • savvy9999 says:

        BR/GAP gives out some beefy discounts if you sign up (and spend enough). I have at least 3 shirts free from BR, bought solely with “here’s a $20 gift card!” that my wife got. Luxe status is great.

        My point with any stored card is that if you’re going to spend the money there anyways, get the perks. BR makes very quality, good fitting clothing.

  2. lizzybeans11 says:

    I don’t understand. How do calls like the one described happen?? How does one CSR confirm things are fine and another magically knows they aren’t? Why didn’t the first CSR know the bill was returned to the company? How does the second one have different information?

    Time and again this run-around happens for people. What is goes on in the CSR universe?!

    • Loias supports harsher punishments against corporations says:

      It’s really sad, but most often it’s likely not the CSR. Obviously, a poorly trained CSR is a useless one. Computer systems that are difficult to use make it hard for CSRs to provide good information to customers.

      And finally, and the biggest offender, is management. They never “get” human communication and customer service. Instead, they focus on what they want for the company, instead of what the customer wants. Ironically, if they focused on the latter, they’d get the former. In most instances, it really comes down to the CSRs being denied the ability to provide you the information you want in the manner you want it. Or, as John Steward likes to say, act “like a fucking person.”

      • Nisun says:

        Having worked as a CSR for an national ISP I have to say it really amount to poor training, and management.I used to have so many calls where it was obvious a newly trained rep gave the customer bad information/didn’t do something (resend a bill/issue credits/take notes). When that happens the majority of the time you get to be the jerk taking all the heat for some guy “who doesn’t care/doesn’t know how” to do his job. Also even if its the companies fault you are rarely allowed to fix anything. Instead you send “Tickets” up to some guy. This guy reviews the tickets and arbitrarily denies some of them them because corp’s attitude is something like “If the customer really wants us to fix it, they will call again”. I really agree with Clark Howard when he calls it “Customer No-Service”.

    • Miss Dev (The Beer Sherpa) says:

      It seems to happen all the time. Everytime I’ve called about my debit card, I’ve been asked if anyone else is authorized on my account. No matter what answer I give, I’m wrong and am told to contact my credit union. I’ve actually called from my credit union, with the manager on the line, and the debit card company would not accept what the manager was saying and kept saying “that doesn’t match what we have on file. Please contact your credit union.”

      It’s pure insanity.

  3. coren says:

    After reading his story below, you might want to remember that if you apply for a store credit card, it’s possible your purchase at the time you apply will be charged to it

    Absolutely true – but if that’s the case, then (much like what happened to the OP) you’ll have paid via that new card and thus won’t pay anything else. It was probably a screw up that had the bill put on the new card – but the lack of a transaction from BR should have sent up a flag when the OP checked monthly statements.

  4. cvt2010 says:

    I’ve had similar experiences with my Old Navy card (which is the same parent company). It wasn’t with an initial purchase, but I didn’t receive a bill for several months (signing up for online bill pay opted me out of paper statements, as it turns out), and therefore didn’t know that I had a balance until the card was declined in the store. I still can’t turn paper statements back on, so I immediately pay off the card as soon as I make a purchase. I would get rid of it, but I buy 90% of my clothing from Old Navy and the card gets me significant savings.

  5. adrienna says:

    Of course the purchase was applied to the credit card. Otherwise, WHY would the company give you a discount for signing up for the card? I have a BR card and have never had any problems.

    • coren says:

      I’ve signed up for a similar card with Pennys – they don’t approve you on the spot (at least they didn’t for me) so it doesn’t make sense for them to charge you either. The discount is for signing up, not using. It hink

      • backinpgh says:

        Go into any store and read the little tags they put at the registers or on the clothing racks…”Save 10% if you apply today!” At the bottom it ALWAYS says you have to be approved and charge the purchase in order to get the discount. Some people aren’t approved instantly for whatever reason, but you CAN get approved instantly. I did this same thing with a JCPenney card, which I promptly paid off when I got the statement and put the card away.

  6. ksouder says:

    I’ve had similar problems w/ Banana Republic. I recently signed up for a store card (not the Banana credit card), and have had the following issues:

    - After receiving the card, I tried to use it at a store. The card was rejected. When I tried to figure out why, it said I had charges of hundreds more than I’ve ever ever spent on the card (before then I used it once, for a little over $100). Needless to say, I was very concerned–and thought my identity was stolen. I called and they seemed to figure it out, but after a bit of hassle.

    - A few months later, after paying the card in full, I received a statement with a charge of 29 cents (I hadn’t used it since paying it off). I tried to pay it, preferring to pay 29 cents rather than the $29 plus hassle for an overdraft removal charge, but I couldn’t even pay it, as the minimum charge is under $1! I tried to pay $1, but I couldn’t, because overpayments aren’t allowed.

    Such a headache. I love Banana Republic, but I dislike all the hassle that has come with this card.

  7. slim150 says:

    I had something similar with express. When getting the card in store the sales girl asked if I wanted to enroll in the $9.99/month identity protection thing. I said no way. When home paid my bill online and thought it was it.

    However by paying my bill online I automatically enrolled in e-billing (and I had used a junk email to sign up to avoid spam) And apparently the girl enrolled me in the protection thing even though I said no. So I was being billed $9.99 without knowing it until collections called. And they said I enrolled in it voluntarily.

    I got the fees waived but had to pay 4 or 6 months of that stupid fee. This was before I knew about consumerist.

  8. Dallas_shopper says:

    And to think all of this could have been avoided if the OP had checked the receipt and noted the last four numbers of the account used to make the purchase. “Oh no, that’s not my debit/credit card! Must be the new card I applied for at Banana Republic. Did I get a bill? No? Better call someone.”

    I mean…DUH.

  9. SofaMonster says:

    The Card is owned by GE Money Bank. I had the same issue. It ruined my credit and I had to pay $600 extra.

  10. xedex08 says:

    I have been in retail for years and am familiar with the general electric bank’s credit card issuance procedures (GAP, Pennys, Old Navy, Br and many others). They swipe your debit card as a fraud deterrence. It pulls your info off of the card and puts it on the application. When the card is processed and approved, you are given a temporary shopping pass which has a temporary card number on it, your credit limit, and a customer service phone number to call. This is all printed on receipt paper. You also get a receipt for the purchase which also indicates your form of payment on the bottom. Other than the issue with your address, you should be responsible enough to reconcile your purchases.

  11. backinpgh says:

    OP must not go shopping very often, because EVERY single one of those “discount if you apply for a credit card” requires you to put the initial purchase ON THE CARD. Maybe the cashier avoided telling him this, but honestly, I knew this when i was 18. How long do you think it takes to get approved for a store credit card anyway? It’s instant! Yes, the following lack of actual card and billing statement is totally Banana’s fault, but if the OP had any common sense he would have known the purchase was charged and would have been looking out for the statement the following month.

    • coren says:

      It’s never been instant for me.

      But even if it were always instant – why was his debit card run at all? He sure as shit should have checked his statement for that card and known he was ahead 90 he shouldn’t have been, but there’s no need to run a card that isn’t having money subtracted from it.

    • tbax929 says:

      I have only ever had a couple of store cards in my life but I’ve never had the initial balance placed on the card. I think I’ve been asked if I wanted to do that, but I don’t think I ever have done so.

      Furthermore, why did they let him swipe his debit card if the balance was going on the BR card. Also, why was he never sent the actual card or a statement? This is just full of fail for BR.

    • greggen says:

      I have gotten the % off for opening a new card a couple times in the past few years and did not apply anything to the new card. It does not ALWAYS require applying the purchase to the card..

  12. skylar.sutton says:

    Wait, you thought you would apply for a credit card and have them charge your debit card? You’re an idiot.

    Nothing to see here folks, move along.

  13. chiieddy says:

    BR credit cards are instant approval and you receive a 10% discount when you put your purchase on it. What happened was they used your debit card as one of your identifiers and you were instantly approved. Because your address was incorrect, you never received your statement. Get the account number from them ASAP and sign up online to view and pay your bill.

  14. Babylicious says:

    I started shopping at Banana Republic about a year ago and also signed up for their credit card to receive a discount. I was approved within a couple minutes and had to pay for the purchase using my new account with them. It was very clear how this worked.

    I have never had any issues whatsoever with BR or their credit card. I pay it in full each month and get frequent discounts by using their card.

  15. Miss Dev (The Beer Sherpa) says:

    GAP did the same thing to me when I was in college. Same company, same incompetence.

  16. kimshot says:

    I’m a part-time BR employee. I doubt this customer was as clueless as he claims for several reasons. I1) t’s very clear that to get the discount on your purchase (usually 15%, but we’ve been doing promo’s the last few months that let the customer save up to 40%), you have to use the card. Not just from signage splattered across the store and registers. The system won’t even allow the transaction to process without using the BR card. 2) the customer is asked to verify the address on the card machine 3) The customer receives the “welcome kit” which includes additional coupons for future purchases, card benefits, as well as APR and other disclosures. 4) They receive a receipt that has the current card number, card limit, contact info so they can make purchases as they wait to receive their physical card in the mail (2 weeks). 5) they receive their actual receipt that shows the last 4 digits of the card, as well as stating that it was paid with a Banana Republic card.

    I don’t doubt the dropped calls because even calling in-store on customers’ behalf, I find GE Money Bank difficult to deal with. I’ve had better luck managing my accounts online and communicating via email.