Bilt Cardholders Receive Mistaken Collection Notices Tied to Third-Party Reporting Error

About 1,850 Bilt cardholders received mistaken collection notices, the Wall Street Journal reported Tuesday (Aug. 4).

A Bilt spokesperson said in the report that the incident was caused by a third-party collections agency’s reporting error and that it affected customers in Bilt’s original beta program using a card that Bilt stopped offering in 2022.

After discovering the issue on Friday (July 31), Bilt offered to work directly with customers, said corrections should appear on credit reports within three business days, and said it would give those who were affected by the incident 2,500 Bilt rewards points, which can be redeemed for up to about $50 on specified purchases, according to the report.

Some of the cardholders impacted by the error said on social media that the mistake had cost them 50 or 60 points off their credit score, per the WSJ report.

These mistaken collection notices came a little over two months after it was reported that Sen. Elizabeth Warren was seeking answers from Bilt about a separate incident involving problems related to its new cards that were introduced in February.

Soon after Bilt introduced the new cards following the end of its partnership with Wells Fargo, cardholders began to complain on social media about issues such as delayed rent payments and difficulty contacting customer service.

“Bilt’s systems appear to have failed many customers attempting to make rent and mortgage payments,” Warren wrote in a letter to Bilt Founder and CEO Ankur Jain.

In a statement provided to PYMNTS at the time, a Bilt spokesperson said: “While the transition to the Bilt Card 2.0 in February represents an even more exciting future that offers our membership richer rewards and greater flexibility, the transition also attracted unexpectedly high demand, and some of our members experienced gaps in service that are simply unacceptable to us.”

In June, the Consumer Financial Protection Bureau (CFPB) said in a press release that it was working with Bilt to address credit card customer concerns stemming from the FinTech’s transition from Wells Fargo to a new banking partner earlier in the year.

Bilt notified the agency that it “proactively reached out to the limited number of potentially affected customers” and offered to reimburse them for overdraft fees, late fees or insufficient funds fees tied to the transition, the CFPB said in the release.