UPDATE: [WELCOME CONSUMERIST READERS -- please excuse the crap layout!]
On Friday, May 9th, 2008 I received an envelope from Banana Republic. Inside I found a single page, printed on both sides with a new Banana Republic card attached. It looked pretty normal until I noticed the VISA logo printed on the lower right side of the card. I scratched my head for a few moments and remembered a letter I had received months ago, presenting the BR Visa card idea to card holders. After receiving the previous letter, I promptly called the number listed on the mailing and instructed the outsourced call center representative on the other end of the line that I did not want to be upgraded to the new Visa card.
A card I explicitly opted out of was now in my mailbox. Something about the mailing seemed off to me. My curiosity piqued and I decided to stave off shredding the document immediately and read.
Strange. One piece of paper, printed on both sides. No Terms of Service included in the mailer and no interest rate printed on the offer letter. Further, the mailer language does not appear to make the switch optional to the consumer.
I called the activation number and begin hitting 0# as soon as I was prompted for the account number. Transferred to a clearly outsourced call center, I began asking questions. The guy on the other end was so flustered I could literally hear script pages fluttering in the background.
I ask to be transferred to a supervisor, which we all know is usually a joke anyway. I ask the supervisor why no terms of service is included in the mailer, why I given the card after I opted out and inform him that this credit card offer is predatory playing on past practices of the BR card. Every year since I applied for the card (to jump start my revolving credit) I have received two BR Cards in the mail every year; a black one and orange on to compliment the seasons (I guess…no clue really). Of course, it’s optional to use the newly mailed card as the account numbers are the same.
With this mailer though, there is no statement saying activation of the new Visa card is optional. The new card can be used anywhere and it has a fairly good rewards package and a $2,000.00 credit line. Pretty exciting for someone who just wanted to finance an overpriced suit over the course of a few months.
The mailer did include a reference to go online to find your Terms of Service, which I would imagine meets their legal requirements. Terms of Service can be found here: https://secure.www.bananarepublic.com/profile/info.do?cid=1061 – the website offers no data on interest rates.
I knew the interest rate on the BR Card is exorbitant, which is why I rarely use it after establishing my revolving credit and obtaining two cards with far better interest rates. I inquired with the supervisor during the call about the interest rate: 20.42%. This is fine if I’m buying a suit but now, with the new Visa card, I have access to purchase ANYTHING with that same interest rate. College kids who applied for the card can now finance the gas on their cars! Fantastic.
I was also informed that the activation cut off date was April 24th, 2008. I did not even receive the card until May 9th. Clearly, Banana Republic’s credit card company has screwed up on this. Excuse the long ramble, I’m still a little hot under the collar from this experience. Here is a bulleted summation of my rant:
- I received a new BR Card in the mail I opted out of months ago
- The new card works as a standard credit card, allowing me to make purchases outside of Banana Republic
- The mailer contained no printed Terms of Service but rather a reference to a website.
- The mailer contained no interest rate information
- The mailer did not state that customers had an option in activating the new card
- The mailer played on previous Banana Republic credit card practices, luring customers into a sense of familiarity.
I would imagine Banana Republic has done nothing illegal; as their lawyers would not allow the company to open themselves up to liability but I personally consider this Unfair and Deceptive if not predatory credit practices. Again, questions of legality can be left to people more knowledgeable in this area.