G ift cards have become very popular because they are a convenient way to give or receive gifts. Persons receiving gift IsIf you have a complaint about your gift card i s s u e r , w r i t e o r c a l l y o u r s t a t e ’ s Consumer Protection aGift Bureau or Consumer Protection Agency and file a complaint with the Federal Trade Commission (http://www.ftc.gov/ftc/consumer.htm) . You can Is aGift cards can choose for themselves also file a complaint with the Better Business what they wish to buy, while gift givers can avoid making difficult Card Bureau (http://www.bbb.org/). Card Rightfor Rightfor ? ? (and sometimes unsuccessful!) decisions. There are some points you should consider to ensure that a gift card is right for you. Gift cards, which are elec- You You Know the costs and benefits tronic versions of gift certificates, before you buy can be purchased at a specific retail chain, such as a department store or supermarket, or from a group of retailers such as a shopping mall. Some gift cards, such as those issued by banks, have a Visa, MasterCard, American Express, or Discover logo and can be used almost anywhere that the particu- lar brand is accepted. Gift cards Federal Reserve Bank of New York are easy to obtain and easy to use. 33 Liberty Street New York, New York 10045-0001 Giving or receiving gift cards is (212) 720-5000 often preferred over cash. www.newyorkfed.org Federal Reserve Bank of New York 02/06 If you’ve got a gift card in your wallet How gift cards work What happens if your card is damaged, or are thinking about giving a gift A typical gift card has a magnetic stripe on the back of lost, or stolen? the card. When you purchase the card, the amount of I Will the card issuer replace your card if damaged, card, you should know… money that you put or “load” onto the card is recorded lost, or stolen? Is there a charge for card in a database that can be accessed by swiping the card replacement? along its magnetic stripe. There may be costs associated with obtaining I Will the card issuer replenish the remaining funds You or someone else can then make a purchase using onto a replacement card? If so, do you have to pay or using a gift card that card. When a purchase is made, the cashier will a fee to put these funds onto the new card? I Before purchasing a gift card, be sure to ask about all swipe the card and deduct the amount of your purchase from the card. I Do you need to register the card with the card issuer the possible fees that may be charged. All cards are In addition, some gift cards allow you to withdraw cash for the funds to be protected against damage, loss different: some have no fees at all, while others may at an ATM. This kind of card requires that you use a PIN, or theft? have fees for purchasing or using the card. or personal identification number, that you will use at I If the card allows cash withdrawals at an ATM, fees the ATM to withdraw cash from your card. What happens if you want to make a may be charged each time the ATM is used. In addi- Some cards are reloadable—in other words, you purchase greater than the dollar value on tion, the ATM operator may charge a fee for usage of can add more money to the card after it has been the gift card? that ATM. purchased. I Will the retailer/merchant accept the value on the I If the card allows you to add more funds, you may be gift card plus accept cash, a credit card, a check, or charged a fee each time you do. Read the terms and conditions before a debit card to complete the purchase? making a purchase* The gift card may lose value over time The terms and conditions provide important How can you obtain information about I If the card is not used for a certain period of time, such information about: the balance on the gift card? as six months, you may be charged a dormancy or I Card expiration date non-use fee for each month after that. I Is the balance information provided to you when you I Card purchase fee receive a purchase receipt? I Pre-funding (loading funds on card) fee If your gift card is lost or stolen, you may not I Per transaction fee I Do you have to call customer service? If so, is there be able to replace it I Non-use (dormancy) fee a charge or fee to use telephone customer services? I Re-activation fee Is the balance information available from a website? Is I Some issuers may not replace your card if it is I I Card replacement fee there a fee to access this information from a website? damaged, lost, or stolen, or they may charge you I Funds transfer/card replenishment (reload) fee for replacing it. I ATM fee Does your retailer/merchant provide you I Monthly maintenance fee with a customer service phone number, I Customer Service fee I Lost or stolen card replacement website address, or mailing address you can use if you have questions about your *The list of terms and conditions is meant to provide you gift card? with help in choosing a card that is right for you. State I If a customer service phone number is given, is it a laws may disallow certain fees charged by gift card toll free number? Are you charged a fee when you issuers. Be sure to check with your state’s Consumer call customer services? Affairs or Consumer Protection Department to learn more about specific laws and regulations related to gift cards.