The U.S. Federal Reserve has announced a new set of proposed rules regarding the shelf life of gift cards and how often fees can be applied to them.
Under the proposed rules, no dormancy, inactivity, or service fee could be applied to any gift or prepaid card until the card had been issued for a minimum of five years and inactive for at least one year. Once fees could be applied, the rules would prohibit more than one fee from being applied every month.
Card issuers would also be required to clearly disclose all fees and expiration dates to the consumer upon purchase or "reloading" of the card.
The rules will undoubtedly help those who looking to consolidate debt by ensuring that gift cards retain their value over time.
"Consumers who do not use the value of the card within a short period of time may be surprised to find that the card has expired or that dormancy or service fees have reduced the value of the card," the Fed said of their decision, according to the Associated Press. "Even where fees or terms are disclosed on or with the card, the disclosures may not be clear and conspicuous."
The Fed’s proposal on gift cards completed a charge given to them as part of the Credit Card, Accountability, Responsibility and Disclosure Act of 2009 to reform the gift card system and issue new regulations.