Feds New Rules Protect Gift Cards

03.24.10 | FL News Team

The Federal Reserve will make it harder for retailers to eat up your gift cards when you don't use them. The Fed has finalized rules on Tuesday that protect consumers from having gift cards suddenly expire or diminish in value. The new rules take effect on August 22nd and will still let retailers have a sunset clause on gift cards. But they can't expire less than five years after the card was issued. And while retailers can still levy a fee for an inactive card, or for maintaining it, or reloading it or letting you check your balance, it can't do all of those things at once. In fact, the limit's just one fee for one card, and only if you haven't used it in a year. Even then, retailers have to explain any fee in a "clear and conspicuous" fashion and provide a toll-free number. An industry analyst said the Fed's new rules will speed up consumers' flight away from costly credit cards to fee-free gift cards.