Gift Cards: Big Business, New Rules

There's a gift card for almost everything, from flu shots to charitable donations to Major League Baseball seats and merchandise. Now the rules of the gift-card game are changing.

In the past, marketers set various expiration dates and fees for their gift cards. Effective August 22nd, however, gift cards must comply with a number of new federal rules. The biggest change is the expiration date: gift cards must be valid for at least 5 years. Where issuers charge a fee (for lack of activity, for example), only one fee may be assessed per month (not counting any fee charged at the time of purchase). And for transparency, issuers must provide clear disclosure of terms and conditions on each gift card.

Some of these rules don't apply to gift cards produced before April 1, 2010, but all gift cards will have to be in compliance by January 31, 2011. Until then, retailers and other gift-card issuers will be posting in-store signs or links on their web pages to appropriate disclosures.