What’s with the Federal Reserve? It’s going all consumer protection on us lately.
Last week they laid down new protections on some overdraft fees. On Monday, they proposed rules restricting fees and expiration dates on gift cards. The plan would stop many “non-use” and service fees on the cards.
Companies could charge fees on a card inactive for a year or more (if the conditions were made clear to consumers upfront) but couldn’t charge more than one fee per month. Expiration dates would have to be set at least five years after the card was issued.
Gift cards have become the present this decade because they’re convenient, easy to buy and send — and we’re able to avoid that really awkward moment of disappointment when people get you something you hate!
In its 2009 holiday shopping survey, the consulting firm Deloitte LLP found:
Gift cards hold their first-place position for the sixth year in a row, with 64 percent of consumers planning to buy them as presents. While the number of gift cards they plan to purchase remains nearly flat (5.4 from 5.3 last year), consumers’ planned spending per card is $35, which is up from $28 last year and nearly back to the pre-recession average of $36 in 2007.
Minnesota in 2007 stopped businesses from selling a gift card carrying an expiration date or a service fee of any kind, including for “non-use.”
By the way, the Fed was directed by Congress to take action on gift card charges as part of the Credit Card Accountability Responsibility and Disclosure Act of 2009.
Will you spend the $35 per card average Deloitte’s predicting? What kind of spending plans do you have for the holiday season? Click here and share your story.