Citibank to Customers: Ditch Paper Statements or Lose Your Online Account

Citibank has told some of its customers that if they don’t opt out of paper statements they will lose access to their online accounts.

The move is the latest in a series of pushes by the banking industry to urge customers to give up physical statements – which cost them in paper and postal fees.

The effort is part of a ‘beta program’ and was rolled out to a small number of credit card customers, a Citigroup representative told the Wall Street Journal.

A Citibank notice issued to credit card holders through its website, a screenshot of which was shared by the Journal, read: ‘We’re requiring you to authorize a switch to Paperless Statements and Legal Notices to maintain access to your account’.

Though the policy reportedly requires customers to enroll in paperless billing to maintain access to their online account, they can switch back to paper statements later and still be able to log in, a representative told the outlet.

Shifting customers onto online statements is a contentious issue and consumer advocates have urged the Consumer Financial Protection Bureau (CFPB) to take action against banks that force their adoption.

According to the CFPB, that adoption has accelerated in recent years. Roughly two-thirds of credit-card customers have enrolled in paperless billing as of last year, up from 36 percent in 2015.

At the time, the CFPB made the case that people that opt for paperless statements are more likely to be disengaged from their finances.

It noted that for consumers, ‘opt-outs [of paper statements] are for the most part opting out of reviewing their statements entirely’.

The CFPB found that 10 percent of digital statement PDFs were ever opened and that about 25 percent of credit card account holders were enrolled in paperless.

It has also in the past cited federal law stipulating that ‘a credit card issuer must establish procedures to ensure that statements are mailed to cardholders at least 21 days before a payment is due’.

The agency advises people that still want mailed statements to review their cardholder agreement or contact the relevant financial institution’s customer service.

Ira Rheingold, executive director of the National Association of Consumer Advocates, told the Journal that Citibank’s most recent action seemed illegal.