Consumer complaint received 2020-05-14
Company: CITIBANK, N.A.
State: CA
Product: Credit card or prepaid card
Sub-product: General-purpose credit card or charge card
Issue: Other features, terms, or problems
Sub-issue: Other problem

Complaint:
I have a BestBuy Credit Card which has Citi Bank as the issuer. I first started using it back in XX/XX/XXXX. At that time, I had a promotional balance of {$240.00} which can be paid off over 6 months period without any interests charged. Hence, I planned my payment of {$42.00} per month, starting from XX/XX/XXXX, to be applied to this promotional balance. Meanwhile, I also paid full payments of whatever regular purchases I made during that statement period which has XX/XX/XXXX r XX/XX/XXXX of each month as the closing date. My statement balance due date is the XXXX of each month. 

Now, 4 payments later, I saw a promotional balance of {$130.00} which didnt add up. So I contacted their customer service where I found out the big issue. I first was told that all the monthly payments I made would be first applied to any regular purchases. Then the rest of the payment amount would be allocated to my promotional balance. This sounded no problem. It made me wonder how come my calculation didnt add up. Then I had the agent help me to go over how the payments were allocated each month. There came the big secret. For example, XX/XX/XXXX to XX/XX/XXXX, I made a regular purchase of {$150.00} which was due on XX/XX/XXXX. My payment of {$190.00} was made on XX/XX/XXXX which allocated to both of my regular purchase amount as well as the 1/6 of the promotional balance. Next month, XX/XX/XXXX to XX/XX/XXXX, I didnt make regular purchases. Hence, only the 1/6 of the promotional balance was due on XX/XX/XXXX. So I made a payment of {$42.00} on XX/XX/XXXX to the XXXX statement, thinking it would be applied to my promotional balance. Not the case. The agent told me partial of that {$42.00} was made to two different purchases that I made on XX/XX/XXXX and XXXX. The was done once again later. My payment on XX/XX/XXXX was partially allocated to a purchase I made on XX/XX/XXXX, which you know, not due till XX/XX/XXXX. 

At first, I just thought this was confusing. It totally messed up my plan. Then I realized, wait a minute, the purchases I made on XX/XX/XXXX and XXXX were not even due till XX/XX/XXXX. When I paid the payment on XX/XX/XXXX, there wasnt even supposed to have an official statement indicated these charges yet since the closing date was XX/XX/XXXX. My XX/XX/XXXX payment was dedicated to my XXXX statement. Why, in the world, did they allocate my XXXX statement payment to my XXXX purchases that had the due date in XXXX? If I had the due date on XX/XX/XXXX, who gave them the right to allocate that payment? Same thing to my XXXX purchases that had the due date of XX/XX/XXXX. They just allocated my XXXX statement payment to my XXXX purchase. 

The biggest issue is, if the customers were not aware of this payment allocation system, their promotional balance would end up going beyond 6 months when interests could be added to the remaining balance. Then I did a little research found out, on the BestBuy website, customers did complain about the same situation where they planned for 6 months equal payments but didnt notice the discrepancy till the interests were added after 6 months. For his situation, he set up auto-payment. I will have to call this a rip-off. 

The agent agreed with my concern saying that she would send a note to the management. I went back to read all the fine prints on their statements, I couldnt find any sentences related to how they allocate payment and how the payments can be distributed for each billing cycle. Most Americans have more than 2 credit cards and make multiple purchases a month. Their newly invented allocation system not only confuses consumers, but also applies payments to charges that are not listed, or shouldnt be listed, on the statements yet. If there is a closing date, the charges should not be listed anywhere else but the statement right after the closing date. This is unacceptable in so many ways. 

The website where I found the complains : XXXX XXXX  XXXX

Company public response: Company has responded to the consumer and the CFPB and chooses not to provide a public response
Company response to consumer: Closed with explanation