American Express Ends Dormant Gift Card Fees
| October 2, 2009 |
It seems that gift cards are getting a lot more attention these days from everyone including consumers, issuers and congress. The reason is more than likely linked to the fact gift card usage has more than tripled within the past couple of years, and there looks to be no slow down as we head into the 2009 shopping season. As things look to follow the same routine as years past, consumers will see one major change to a gift card issuer that they probably know very well. That change comes from the largest prepaid gift card issuer in the United States, American Express, which has decided to eliminate fees associated with unused gift cards.
So what could American Express look to possible gain by eliminating fees that are associated with dormant gift cards? Experts believe the prize is an even bigger share of the estimated twenty five billion dollars expected to be spent on gift cards this holiday season. Although dormancy fees will end, consumers are still going to be charged in other areas. American Express will still charge purchasers two to seven dollars for cards worth twenty five dollars or more.
Experts believe that this move by American Express will force other gift card issuers to do the same and even cause some to abandon the gift card business. This is because those issuers that were struggling before this move by American Express will now more than likely be forced to end their dormancy fees on which they rely.
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