I have not but come across a sound explanation why there should really be costs or expiration on gift cards. Initially, by obtaining gift cards, consumers are primarily providing the card issuers an unsecured loan, on which they earn no interest, even if the card is not redeemed for a year or extra. Second, if yoursite.com goes bankrupt, there is quite tiny likelihood the dollars will be returned (except in a handful of circumstances, like recently with Linens and Things).
So, if customers are taking on these dangers by getting present cards, why need to they then be subjected to charges and expiration? They may well as nicely adjust the present card fee disclosures to read like this:
Dear Present Card Purchaser,
We really appreciate the unsecured loan you gave us. With each other, you all gave us $97 billion in loans in 2007, up from $83 billion in 2006. You know we could use the further money, given all the talk of a recession. We thank you for not charging us any interest or charges on the loan. We will place your funds to perform instantly and generate wonderful returns on it. You could even hear about all the kudos we will get from Wall Street due to our outstanding earnings (which will be helped by the revenue we get when your present card expires). Heck, our CEO may even buy his third McMansion in the Hamptons just after we reward him for creating superior use of your loan. A few residence cleaning things:
1. If you purchased the gift card from our web-site, we may perhaps charge you a processing fee, separate from the shipping charge, in order to get you the card that shows that we owe you money. Really feel free to purchase stuff in our retailer up to the quantity of the loan (present card value). But if you never hurry, we will punish you each month by charging you ridiculous fees. These fees can start out as quickly as six months into the loan. We may perhaps even start your charges as early as a month into the loan if we so desire. And don’t forget, the costs will continue till the balance on your present card reaches ZERO. Why? Simply because we can. Yes, your state legislatures are all complaining about this simply because it is an election year. Do you actually believe they will do one thing about this?
2. Also, we have noticed from knowledge that some of you like to wait a lengthy time, and we imply a long, extended time to redeem your present card. It requires a while for us to get your $one hundred present card to ZERO if all we are charging is $2.50 each and every month. So, we now have a far better concept. We will charge you the $2.50 for sometime and if you nevertheless never redeem your gift card by a specific date, say within two years, your card will expire. After your card expires, we will get all the revenue left on the card. You are most likely wondering if this is legal. Properly, no one particular has told us it isn’t.
3. And do not even think about losing your card. We reserve the right not to replace lost or stolen gift cards. Yes, we know that if you drop your Savings Account Statement or CD Certificate, the bank will replace it, but we are not a bank, so we can do what ever we want. If we really feel generous, we may replace your gift card, but we will charge you a charge, up to $15 to teach you a lesson.
4. Lastly, if you purchased a bank issued present card (like Visa, MasterCard, American Express, or Discover), then you far better study the fine print and grow to be familiar with costs like Transaction or Statement Copy Fee, Foreign Currency Conversion Charge, Check issuance Fee, and Transaction Fee / Balance inquiry Fee. And one particular final point Do not get in touch with the FTC due to the fact they might be prepared to push for laws to limit costs on retail present cards but they have not been prepared to touch us, the bank issued gift cards. Why? Because our lobbyists are performing an excellent job.
We hope you enjoy your present card.
It is my belief that present card issuers will be better off and make extra revenue if they get rid of charges and expiration from present cards considering that the damaging publicity around present cards from both state lawmakers and the news media has led some consumers to remain away from gift cards. This is specifically accurate in the course of the holiday season when just about every regional news station and newspaper appear to run a story about the dangers of gift card fees and expiration.