If the gift card was purchased on or after August 22, 2010, the fees that can be imposed may be restricted.
Inactivity fees and usage fees are considered to be service fees. Generally, service fees can only be charged if:
- You haven’t used your card for at least one year, and
- You are only charged one fee per month
You can be charged fees on a gift card that are not deemed to be service fees. For example, you could be charged a fee to purchase the card, to cash out the card or to replace a lost or stolen card. Those types of fees can be imposed within the first year of purchase as they are not service fees.
If the gift card was sold before August 22, 2010, you will need to check the account terms for information about the fees that can be imposed. Some gift cards sold prior to August 22, 2010 may impose fees for activation and for use of the card. The new law is not retroactive, and its restrictions on service fees do not apply to gift cards purchased prior to August 22, 2010.
Fees that may be imposed on gift cards purchased prior to August 22, 2010 include:
- Purchase Fees – fees that may be charged when you buy a gift card. This fee is an addition to the money you pay for the value of the card.
- Monthly Fees – fees that may be imposed for service, maintenance or administrative fees and that can be deducted from a gift card balance.
- Inactivity Fees – fees that may apply if you do not use the card within a certain time period. For example, a monthly fee may be deducted from the gift card balance if the card’s value has not been used up within six months of purchase.
- Transaction Fees – fees that may be charged for each transaction or possibly for certain types of transactions such as ATM withdrawals.
- Miscellaneous Fees – fees that may be charged for balance inquiries, replacing a lost or stolen card or other services related to the card.