New Rules for Gift Cards…That Don't Go Into Effect Until August, 2010

Gift cards have become a common and convenient way for busy shoppers to remember friends and loved ones, while avoiding the hassle associated with fighting mall traffic and trying to guess what your recipient wants.  Gift cards are convenient, but a staggering number of gift cards go unspent, with the balances reverting back to the retailers and banks who issued the cards.  Last year, Best Buy cleared $38 million and Home Depot cleared $37 million – all from unused gift card dollars.

A New York Times article from December, 2009 reports that this year (2009) an estimated $5 billion of gift card value will go unused and revert back to the issuer.  Some of the cards are lost, while others lose value month by month through inactivity fees.  One gift card vendor promotes its services to retailers by claiming that that rotating gift card display may be the store's most profitable square foot of space in the location.

Responding to consumer complaints, Congress has stepped in with sweeping regulations that limit inactivity fees and restricting expiration.  Disclosure requirements have also been enhanced.  But, bowing to pressure from retailers and banks, these new rules do not go into effect until August, 2010 – meaning that they do not apply for the 2009 Christmas season.