Gift Card Laws and Regulations

US, state, and local laws all have a say in gift card policies. Dormancy charges, inactivity fees, expiration dates, and even what happens to unclaimed gift card funds are now being regulated on a state-by-state basis with federal regulations ruling them all. As merchants, it is our responsibility to know and understand these laws and how they affect our businesses and policies.

Federal Gift Card Regulations

On March 23, 2010 the Federal Reserve Board announced final, federal rulings restricting gift card fees and expiration dates to protect consumers from certain unexpected costs. Under this "final rule" all gift card conditions must be clearly stated on the back of the card and gift card dormancy, inactivity, and service fees were banned unless you meet special criteria. This ruling covers all retail gift cards, for individual merchants, merchant chains, and affiliated merchant gift cards, as well as network-branded gift cards redeemable anywhere a merchant accepts the card type.

• The consumer has not used the certificate or card for at least one year
• No more than one such fee is charged per month
• The consumer is given a clear and conspicuous disclosures about the fees.

Expiration dates for funds underlying gift cards must be at least five years after the date when funds were last loaded. This law went into effect on March, 22 2010 and has been published in the Federal Register.