NDSU Extension Service - Ramsey County


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A Longer Life for Gift Cards

A Longer Life for Gift Cards


          When Congress passed the Credit CARD (Credit Card Accountability Responsibility and Disclosure) Act in 2009, the majority of the focus was on the positive effect the new legislation would have on fair treatment of credit card users. Also included in that legislation, but receiving much less attention were the stricter rules for gift cards.  Those new rules took effect the middle of this month and make life with gift cards much easier too.

          The new federal rules regulate fees and expiration dates for all gift cards, whether they’re sold by a merchant, shopping center or credit card company.  These regulations do several important things, including:

  • An inactivity fee cannot be charged until the card has not been used for 12 months.
  • Gift cards cannot expire for at least 5 years.
  • No more than one fee (of any kind) can be charged to the cardholder in a single month.
  • Information printed on the card must disclose fees and expiration date and provide a toll-free phone number or website where you can get more information.
  • A one-time fee can be charged when you buy the card.

          One goal of the new legislation was to ensure consistency of policy from gift card to gift card and company to company.  Now no matter where consumers purchase a gift card, the terms of its use are the same – less confusion and more ease of use for everyone.

          A major consumer complaint about gift cards has been the inactivity fees companies charge and the short expiration dates for the cards – all of which translated into cards losing their value before a consumer actually used the card.  While those unexpected surprises have been eliminated, there still can be a one-time transaction fee when the card is purchased.  No doubt, those fees will vary from card to card so be an alert consumer and know what you are being charged for.

          A big positive of the new legislation is that while a card can expire, your money cannot disappear.  If your card expires but has money remaining on it, you may call the company and request a new card.  The companies are required to provide this service free of charge or return your remaining balance. 

          New gift cards are required to have this info and a toll-free phone number printed on them but it will take some time for the new cards to be on the market.  So in the meantime, read those disclosure pamphlets that are given to you when the card is purchased and pass the pamphlet on to the gift recipient.



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