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New Gift Card Rules Aimed to Help Consumer

Posted: August 24, 2010

Gift cards are about to get a lot better. Last weekend, new federal rules went into effect that regulate fees and expiration dates for all gift cards, whether they’re sold by a merchant, shopping center or credit card company.

"It's a new day for gift cards,” says Linda Sherry, director of national priorities for the advocacy group Consumer Action. “This holiday season, consumers can purchase cards for family and friends in full confidence that the funds won't disappear in a puff of fees.”

The new gift card regulations are part of the Credit CARD Act (Credit Card Accountability Responsibility and Disclosure Act of 2009) passed by Congress last year to eliminate many of the abusive practices in the credit card industry.

Here are the highlights of the gift card rules:

  • An inactivity fee cannot be charged until the card has not been used for 12 months.
  • Gift cards cannot expire for at least five 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.

“This adds consistency to gift cards because now everyone is playing by the same rules,” says Greg McBride, senior financial analyst with “It helps consumers because now a gift card is a gift card. It really doesn’t matter who it’s purchased from, the terms are the same.”