Gift cards are a popular holiday gift; the Better Business Bureau of Hawaii says they make up approximately 18% of holiday purchases, and that nearly 50% of consumers will receive a gift card during the holidays.
With so many of those cards in circulation, BBB Hawaii’s CEO Greg Dunn wants to review some rules concerning gift cards. In 2009, Congress passed the Credit Card Accountability Responsibility and Disclosure (CARD) Act, which set consumer protections for gift cards.
Dunn says in Hawaii, gift cards must clearly state an issue and expiration date. The minimum expiration date for a gift card must be five years from the date of purchase. A one time activation fee is allowed, but periodic service fees, including for inactivity or dormancy, are not allowed. The activation fee cannot be more than 10% of the face value or $5, whichever is less.
“There are apps to manage gift cards as well, for instance, Gyft is free on iOS and Android. Use it to keep track of your own gift cards from anywhere. You can also earn points on gift cards you give, and eventually have enough rewards to earn gift cards for yourself!,” informs Dunn.
Other apps include:
- Can upload gift card balances from select retailers allowing you to use the card without physically having the card with you
- Can also upload balances of e-gift cards received
- Can store credit and debits cards as well as store, loyalty and rewards cards
- Does everything that Apple Passbook did and works through Apple Pay
- Offers an array of gift card products including personalized gift cards, group gift cards, egift cards, discount gift cards, and local gift cards redeemable at millions of establishments across the country
- Rewards program offered on select gift cards
- BBB Accredited
- Dunn also warns people of common gift card scams. “Sometimes, the card is stolen before you buy it. The thief will take the card, record the card numbers, and then put the card back in the gift card display. When the gift card is purchased and activated the thief is able to spend the value of the card online,” he says. To avoid this, select less accessible cards, like those in the bottom of the pile, behind the counter, or not on display.
Some manufacturers have added special packaging or personal identification numbers (PINs) to their cards to prevent theft, because tampering with the packaing is another concern. “There is a scratch-off label on the back of the card that contains the hidden number. Before purchasing, check all packaging for any signs of tampering and make sure that the number is still covered,” he advises.
Gift cards are sold online as well, but may be already used, or for a lesser value than stated, says Dunn.
“Only buy discount gift cards from resellers who provide a guarantee, and check with the BBB for reputable online resellers.”
Sometimes, Dunn says the fraud can happen at the store!
“As the customer hands a gift card to the cashier for activation, the cashier activates a different card and hands the original back to the customer. Keep your eye on the gift card at all times and ask to have it handed back to you as soon as the card is activated. Check the gift card number listed on the activation receipt to ensure it matches the number on the card you just received as well.”
FTC Has Gift Card Tips for Holiday Buying https://www.ftc.gov/news-events/press-releases/2010/11/ftc-has-gift-card-tips-holiday-buying
Hawaii Revised Statutes §481B-13 Gift certificates http://www.capitol.hawaii.gov/hrscurrent/Vol11_Ch0476-0490/HRS0481B/HRS_0481B-0013.htm