John Lewis ‘sorry’ for credit card chaos as more complain of rejection

Retail giant John Lewis has vehemently denied disenfranchising thousands of its loyal credit card customers as a result of appointing loan company NewDay to run the card. 

Hundreds of John Lewis cardholders have contacted The Mail on Sunday in response to our exclusive report late last month, highlighting widespread disquiet among customers over the move. 

Many are outraged that in reapplying for their credit card – a regulatory requirement – they have either been declined by NewDay or had their four or five-figure credit limits reduced to just three. 

Most have a history of clearing their John Lewis card balance every month and believe their financial prudence has worked against them because NewDay views them as ‘unprofitable’ customers. Some say they will never shop at John Lewis again or at its Waitrose food stores. 

On Friday, John Lewis said that 96 per cent of customers who had applied for the new partnership card had already been accepted by NewDay. More than 84 per cent, it insisted, had been offered the same or a higher credit limit. 

Amir Goshtai, director of John Lewis Financial Services, told the MoS that it was ‘beyond regretful’ that some customers had been left disappointed. NewDay, regulated by the Financial Conduct Authority, refuted accusations that it was excluding prudent, creditworthy customers from continuing with their John Lewis card.

It also said it was ‘categorically not the case’ that it was only interested in targeting customers who don’t clear their balance every month. John Lewis cardholders who are successful with their re-applications will pay interest of 18.9 per cent on uncleared balances. 

The store’s partnership card is hugely popular with John Lewis and Waitrose shoppers because of the generous rewards it offers. 

For example, for every £400 they spend on their card at a John Lewis or Waitrose store, they receive a £5 voucher. Over the past five years, John Lewis has issued vouchers to the value of £230million.

The loss of these vouchers is one of the main reasons why those who have been declined a new card by NewDay feel so angry. 

Among the disenfranchised is Lorna Smith, who runs an arable and livestock farm with her husband in Towcester, Northamptonshire. Lorna, who also manages a livery stables on the farm, has had a John Lewis credit card since it was launched in 2004. The 61-year-old had a credit limit of £14,400 and loved the regular cash vouchers she would get for using the card. 

When she received the email stating she would have to reapply for a card, she thought it would be a formality. Lorna says: ‘Myself and my husband Peter own our farm, we have a successful business – Block Aid UK – renting out concrete barriers and marquee weights and we own a number of buy-to-let properties. We also have savings and shares. We’re not super-rich, but neither are we on the breadline.’ 

Yet, it didn’t count for anything. Her application was rejected and she was left stunned. ‘I’ve never been rejected for a credit card in my adult life,’ she says. ‘It’s crazy because I pay my card bill in full every month.’ 

Angry, she complained to NewDay. Last Wednesday, she received an email from its ‘executive and media’ complaints team stating that it could not approve her application on the basis of ‘eligibility’. She describes the decision as ‘farcical’ and says she will stop shopping at both John Lewis and Waitrose. 

Cathy Pole has also been told she has not met the criteria for a new John Lewis partnership card. 

Like Lorna, the 75-year-old former chief executive of the Human Genome Organisation has always used her card prudently, never maximising the £10,000 credit limit available to her.

‘I’ve lived at the same address in Radlett, Hertfordshire, for 46 years,’ Cathy says. ‘I’ve got a decent pension and while my investments may be going down in value as the stock market falls, I’ve got no mortgage, no debts or children to support.’

She also complained about being rejected – and received the same letter Lorna got from NewDay’s executive complaints department about her ineligibility. 

‘Maybe, I’m too good a customer and don’t make them enough money,’ says Cathy. ‘I’m both baffled and annoyed by John Lewis’s decision to ditch me after I’ve been with them since 2004.’ 

On Friday, John Lewis’s Goshtai told the MoS: ‘We know how much our customers love our partnership card, so it’s beyond regretful that any of them are disappointed by this change. 

‘The only reason a customer would be declined or get a lower limit is for affordability or creditworthiness reasons which are regulatory obligations for credit providers. 

‘Any customer who has a question about their application should contact us and we will do everything we can to help.’ 

NewDay said disappointed John Lewis cardholders should contact the customer services team (new card application) on 033 0165 4868 (lines open 10am to 7.30pm Monday to Friday, 9am to 5.30pm Saturday).