According to a new complaint from a consumer advocacy group, the Starbucks app traps customers in a cycle of constantly adding more money to their accounts because they can’t use up the remaining balance. Customers earn double the loyalty points if they pay for their orders on the app.
But consumer advocacy groups say some features of the prepaid cards mean customers are trapped in a vicious cycle of spending more money at Starbucks. Customers can only add money to their Starbucks cards in the app in $5 increments, with a minimum of $10. This means the account is always overdrawn, often unable to add enough to cover a single purchase.
Many users have gathered to denounce Starbucks for making a profit of up to 900 million USD
The complaint says Starbucks traps customers by charging more than they want to spend and leaving them with leftovers they can’t use. The coalition alleges Starbucks engaged in unfair and deceptive trade practices that violate the Consumer Protection Act . The complaint says the company profited from its unfair in-app payment system by $900 million over five years.
In its formal complaint, the group said that customers loaded approximately $15 billion onto Starbucks cards last year, and that the company relied on those funds as a source of interest-free working capital. As a result, the company had a strong incentive to maximize the amount of money flowing into its payment platform, and sought to do so by using manipulative digital design features on its mobile app.
A Starbucks spokesperson told Fortune that the company is committed to working with customers to ensure compliance with all laws and regulations. Starbucks said that when paying in-store, customers have the option to split their payment method to use up the full value of their Starbucks card and then pay the remaining balance with cash or a credit card.
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