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Tuesday, December 11, 2012

Why Gift Cards Need Stronger Regulation

If you buy a Chase gift card for a friend or relative or employee, you may notice that it comes with snowflakes or bubbles or one of the other decorative choices the bank offers. One thing you may not notice is that it also comes with an “inactivity fee” which kicks in after twelve months and starts removing $2.50 in value from the card every month. For slow-to-spend shoppers, that works out to a $30-a-year fee for letting Chase hold onto your money.

Gift cards are expected to be the #1 gift this holiday season. More than 80 percent of shoppers will buy at least one this year, according to a recent retailer-backed study – and they will spend an average of $156.86 per card. Many cards come from traditional retailers like L.L. Bean and Dell, which are both also using gift cards as an inducement to buy other gift cards— so-called promotional cards. Some givers, knowing neither what their aunt or nephew might want nor where they would want to shop, will turn to bank gift cards like the one from Chase.

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1 comment:

  1. Queensgirl52December 11, 2012 at 12:56 PM

    If you don't mind my plugging my parish church: St. Francis de Sales Church right here in Salisbury offers prepaid scrip shopping cards which are good at many local and national stores and restaurants. The beauty of these cards is that the purchaser pays only the face value (you pay $25 for a $25 card) and the parish gets a portion of the proceeds of each card. The cards are available in the parish office Monday through Thursday and in the main vestibule of the church after all Masses on the weekend. There's an order form on the parish website; however, new businesses are added all the time, so the paper forms available in the office and the church are usually more up-to-date.

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