A new bill from Sen. Richard Blumenthal, D-Conn., would ban expiration dates and inactivity fees on all gift cards and also on promotional and incentive cards. It would also force companies that are in bankruptcy to honor their gift cards.
From the Yale Daily News:
“This bill would expand and enhance the protections beyond what states now guarantee and would also provide a uniform national standard, which is important because many of these companies are national companies,” Blumenthal said in an interview with the News. He added in a statement that gift card companies charge “absolutely draconian deadlines and abusive fees and charges that unfairly confiscate consumer gift card cash.”
The bill appears to make the same mistake as many consumers, and even companies, in that gift cards and promotional cards are the same thing. It also seems to operate on the unspoken assumption that issuers want cards to go unredeemed, which is the opposite of reality. While the bankruptcy provision most likely would benefit both creditors and consumers, the rest of the bill would likely strangle the use of prepaid for rewards and promotions.
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