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What to know about gift card laws

Dec 26, 2022 | 4:10 PM

December 26, 2022 – There is a good chance you received a gift card in your stocking this year. Gift cards can be a convenient present for the holidays and special occasions. But it’s important to know your rights and avoid getting scammed.

The Credit Card Accountability Responsibility and Disclosure Act provides several protections for consumers who purchase certain types of gift cards, including store and restaurant gift cards. These cards can only be redeemed at the stores and restaurants that sell them. Bank gift cards, which carry the logo of a payment card network (e.g., Visa, MasterCard), are also subject to Credit CARD Act protections and can be used wherever the brand is accepted.

Under the law, a gift card cannot expire until at least five years from the date it was activated. The law also places general limitations on fees. For instance, the card issuer cannot charge a dormancy or inactivity fee on a gift card unless there has been no activity for one year and the card clearly states its policy toward that fee. In addition, Illinois law does not allow a gift card’s value to be reduced for non-use or untimely redemption of the gift certificate.

Additional tips:

– If possible, register your gift card. This may help protect you in case the card is lost or stolen.

– Ask anyone who gives you a card for its terms and conditions, the original purchase receipt, or the card’s ID number. Keep this information in a safe place.

-Use gift cards as soon as possible, because it’s not unusual to lose or forget about them.

-Treat a card like cash, and if it is lost or stolen, report this immediately to the issuer. Some issuers will not replace cards that are lost or stolen, while other issuers will, for a fee.