Costco is switching Mastercard users from Capital One to CIBC — and cardholders say it’s not going smoothly

On March 7, Peter Martin logged onto his online Costco Mastercard account to check his most recent statement and got a shock: It wasn’t there.

Costco was in the midst of switching its Mastercard users from Capital One to CIBC, so Martin got in touch with Capital One to see what the problem was.

A customer service representative told him his account information had been transferred to CIBC. He then spoke to a CIBC agent who said it would take days for his account information to be transferred.

“They should have had everything ready to go on day one,” he said, adding that he also wasn’t able to register his CIBC account through the bank’s mobile app.

Martin is one of dozens of people who have gone public after experiencing issues with the transition to CIBC. On Twitter, numerous posts have been made about transactions not showing up online, issues when registering for a CIBC account and hours-long waits on the phone for customer service.

CIBC admitted some customers had difficulty accessing accounts but said that all credit cards functioned normally throughout the transition.

“We have successfully converted all existing Costco cardholders over to CIBC, with uninterrupted access for clients using their card at their favorite merchants, including Costco. Mobile and online banking is also now available for cardholders and we’ve seen hundreds of thousands of clients register already,” Nima Ranawana, CIBC’s public affairs senior consultant, said in a statement.

Last year, Costco and CIBC announced that the switch from Capital One would be made in March 2022. With more than 10 million Costco members in Canada, the transition took place over several days from March 4 to 7.

Customers with Costco Mastercards issued by Capital One were told they had to continue using their existing cards even after the switch was made, as the CIBC branded cards wouldn’t arrive until as late as Aug. 31.

The bank said all existing Costco credit card accounts would be automatically converted to CIBC, but cardholders would have to manually register for CIBC mobile banking to manage their accounts.

Martin said he had difficulty registering his CIBC account through the bank’s mobile app. He took his complaint to Twitter, where he was told by a CIBC customer agent to register via a web browser instead, which worked.

“Because I’m in IT, I said please get your guys on it. Others are going to run into the same problem,” he said. Especially as the mobile app is the method they’re telling customers to use to register, I added.

As a loyal Costco customer for 30 years, Martin was surprised by the messy transition to CIBC. When the retailer changed bank providers from American Express to Capital One in 2014, he said the transition was flawless. The account information was smoothly transferred, he had no problems accessing his account and new cards were provided instantly, without the long wait.

In Toronto, Ken Blackburn said he can still use his card, but on March 3 an unknown transaction appeared for $89. He first called Capital One, which then directed him to CIBC, as they were in the process of transitioning all cardholder information.

On March 7, he called CIBC to dispute the transaction and was put on hold for 80 minutes. After going through various agents he was told to call back in the afternoon once all the data from Capital One was transferred.

He asked for the bank to put a note next to the charge saying it’s disputed, but CIBC was unable to fulfill the request.

“I’ll call back at the end of the week,” Blackburn said. “But I can’t face it right now.”

He said he’s a “little bit scared” to use the card until the unknown transaction issue is resolved.

CIBC agreed that wait times are long but asked for patience.

“There is tremendous interest in the new CIBC Costco Mastercard and we’ve received a high number of calls as we help existing cardholders with specific questions about their accounts and registering online, which is leading to wait times being longer than usual. We’re continually updating our website with information for clients, and we’re working as quickly as we can to help clients who have specific questions,” Ranawana said.

Similarly, Keith Gosse, who lives in St. John’s, NL, found that not all of his transactions were showing up on his online Mastercard account.

“In the three-day changeover, purchases weren’t there,” he said. “But now it’s slowly showing up.”

His main problem arose when he was unable to change the payee on his Tangerine bank account to CIBC from Capital One.

The bank’s website asks customers to change the payee to CIBC Mastercard. But when Gosse did this, it said the payee was invalid.

He called CIBC and went through various calls waiting hours before he got through to a customer agent, when he was told to leave the payee as Capital One Mastercard and not switch over to CIBC Mastercard.

“I’ve made some payments, so I’m waiting to see how it works out. I have nightmares about $1,000 disappearing into the ether,” Gosse said.

As a self-described “tech guy,” Gosse said the experience was frustrating, as it should have been an easier transition.

“This has been a weird changeover. These days banking systems should have information on your accounts immediately. There shouldn’t be a three-day window where you have no idea if your purchases are being processed or not,” he said.