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Better Business Bureau ®
Start With Trust®
Western Virginia
BBB’s Guide to Gift Card Giving
November 27, 2012

With the holiday season in full swing, many shoppers are looking for the best gift options for family and friends. Gift cards may seem like a simple solution, but BBB Serving Western VA is warning that some gift cards could carry high fees making them far from a good deal.

The Credit Card Accountability, Responsibility and Disclosure (CARD) Act
http://www.whitehouse.gov/the_press_office/Fact-Sheet-Reforms-to-Protect-American-Credit-Card-Holders, which took effect in 2010, established standards that give consumers additional protections when using gift cards. The standards prohibit retailers from:

  • Setting expiration dates less than five years after the card is purchased; and
  • Charging dormancy, inactivity, and service fees unless the card has not been used for at least 12 months. If fees are charged after this period, the details of such fees must be clearly disclosed on the card.

These standards apply to store gift cards and general use prepaid cards, which are often branded by payment networks such as Visa, MasterCard and American Express.

But there are some details the CARD Act doesn’t cover. For example, issuers can still charge fees every time the card is used, the balance is checked, a replacement card is requested or when customer service is called.

BBB recommends the follow tips before buying a gift card:

  • Research before you buy. Buy from a known and trusted source. Research businesses at bbb.org to see a company’s BBB Business Review. Avoid online auction sites, because the cards sold there could be counterfeit or obtained fraudulently.
  • Read the fine print. Fully understand how the card works, if there are any fees associated with buying or using the card and if any fees will be deducted from the card after it is purchased.
  • Inspect the card before buying. Verify that protective stickers have not been removed and the PIN Number on the back of the card is not exposed. Report any damaged cards to the store selling the cards.
  • Provide receipt with gift card. Give the recipient of the gift card the original receipt in case the card is lost, stolen or there is a discrepancy with the balance.

If you need more information, contact the BBB at (540) 342-3455 or (800) 533-5501. You can also visit www.bbb.org. Follow us on Twitter at twitter.com/BBB_WesternVA.