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Answers about Gift Cards

Select from the following questions about Gift Cards.

I'm considering sending gift cards as presents to my friends and family. There are so many to choose from. Are all gift cards alike? If not, what are the major differences?

The terms and conditions of gift cards can vary greatly. It is especially important that consumers be alert to the variety of terms and conditions available in the gift card market. A gift card is a type of prepaid or stored value card that is designed to be purchased by one consumer (purchaser) and presented as a gift to a second consumer (recipient). The terms and conditions of gift card products can vary significantly.

The two main categories are retail gift cards and bank issued gift cards.

• A retail gift card is typically offered by a major retail, entertainment or food-service company to be used at establishments owned and operated by that company.
• A bank issued gift card is typically issued by a financial institution, and carries the logo of a payment card network such as VISA, MasterCard, or American Express. These cards can be used at establishments and businesses that accept cards that access those networks.

The OCC issued guidance to national banks with requirements for clearly disclosing the fees and terms associated with the product.

What should I consider before purchasing a gift card?

Every year billions of dollars in gift cards go unused. Make sure you use the gift cards you receive. If purchasing them for someone else, you want to be reasonably certain that the recipient will use them as well.

Prior to purchasing the card, you should read the product disclosures to understand the important terms and conditions of the account.

Key issues to consider are:

• Any fees that apply during or after the sale that reduce the value of the card;
• Whether the card has an expiration date;
• What to do if the card is lost or stolen;
• What to do if there are problems with the card;
• Where the card can be used; and
• How to claim any unused portion of the card.

If the information is not on the card itself or its packaging, the OCC suggests that consumers check to see if there is a toll-free number or Web site that will provide this information.

I'm purchasing a $50.00 gift card and I want the recipient to get the full value of my gift card. What can I do to ensure that the full value of the gift is available to the recipient?

You should know the terms of the card before purchasing the gift card and you should pass that information on to the recipient. You should check about any fees that can be imposed for the purchase and use of the card.

You should probably consider the following:

• Any fees that apply to the purchase and use of the card, including those that apply after the sale and that reduce the value of the card;
• Expiration Date;
• Procedures to follow if a card is lost or stolen;
• Procedures to follow if there are problems with the card; and
• Where to use the gift card.

If the information is not stated on the gift card or its packaging, check for a toll-free number or Web site that will provide this information. It's best to determine the features of the card before you purchase it, and to let the recipient know.

I purchased the card with cash. What types of fees can be imposed?

Some gift cards may not have fees but others do charge various fees for activation and use of the card. Some fees are deducted from the value on the card.

These fees may 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.

I checked the account terms and found the terms acceptable. Is there anything else I should do?

If you are giving the gift card please pass the disclosures, terms and information you received with the gift card to the recipient. This will ensure that the recipient has the information so they can make the best use of your gift.

I'm having a problem with the company that issued a gift card. Can you help me?

Maybe, depending on who issued the gift card. The OCC has authority over national banks. If a national bank issued the card, it would be appropriate to contact the OCC with your concerns. But if someone else, such as a retailer, issued the card, it would be more appropriate to contact the Attorney General's office or another agency in your state with responsibilities for consumer protection.

Phone: 800-613-6743
TDD Number 713-658-0340
TTY: (800) 877-8339 (via a relay service)

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