WASHINGTON (Dow Jones)-- Most U.S. consumers are unaware that some general-purpose gift cards are subject to monthly fees and can expire, a Consumer Federation of America survey released Monday found.
Does that mean that GiftCards.com jumped the gun with their announcement (see previous post) introducing their No Fee Gift Card?...On the heels of this report from the Wall Street Journal, it certainly won't backfire on them.
General purpose gift cards, most of which are issued by Visa Inc. (V), MasterCard Inc. (MA) or American Express Co. (AXP), can be used to make purchases at various retailers. Some of these cards, about $4 billion worth and growing--can cost $4 to $7. The gift cards could also have monthly fees as high as $4.95 that are assessed six to 12 months after the card is purchased.
According to CFA's survey, only 33%, or one-third, of 1004 adults surveyed between Oct. 16-19 knew how much the cards cost. Fifty-four percent were aware of the potential monthly fees.
In recent years, fees on gift cards have become a thorny issue for consumers who inadvertently discovered that the value of their gifts had diminished over time because of monthly maintenance or inactivity fees or short expiration periods.
To combat this, CFA and the National Association of Consumer Agency Administrators are launching consumer educational brochures that contain recommendations for gift card purchasers and recipients.
Continue Reading at WSJ
