States and Retailers Fight for Your Unused Gift Cards
| July 2, 2009 |
Since the recession began, every state has been aggressively finding ways to maintain and increase their revenue. In many cases, one viable source of revenue has been collecting on what is called “abandoned property” which includes anything from unclaimed stimulus money to dormant bank accounts. Because many states are still facing rising debt and the inability to agree on where a budget should be set, some states are thinking about turning to collecting money on unused gift cards to increase their revenue.
The truth is that many states already collect the money left on unused gift cards after a determined period of time. In these cases, the state requires retailers and third party gift card processors to keep an updated database tracking when cards are issued and when they have been used. In states that are not collecting unused gift cards, many times retailers often revert it as income or use the funds to reduce operating expenses.
This is not the first time that state government and retailers have clashed over gift cards. For many years, states had pressured retailers to eliminate dormancy and other fees protested by consumers. Not budging, it now seems like the shoe is on the other foot as retailers now oppose the state’s effort to claim funds of unredeemed gift cards. Every year around $65 billion in gift cards are spend by Americans while around $6.8 billion go unredeemed. Now you know why both state and retailers are fighting tooth and nail on what is left on the table by consumers.
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Comment by Aaron Wakling — July 2, 2009 @ 2:15 pm
I never thought of that, but this is the type of thing that gets my blood boiling.
It seems clear that the retailer should get to keep the $ that is not
spent on a gift card after a set amount of time, not the government.
Comment by RD — July 2, 2009 @ 3:37 pm
I would be upset if I was a retailer. They help cover the costs of the gift card programs by the money that isn’t used. It also boosts profits a little, which in turn helps people keep employed.
Comment by Scott in USA — July 6, 2009 @ 2:10 pm
Hmm, Government taking unused gift cards and others monies.
I am on the Sears rewards program. I get points for so many dollars I spend using my sears card. I reeem those points for a sears gift card. I keep those cards in case an appliance needs replaced. I am on SSI, so it is important as a backup fail-safe.
If you took a 300 dollar gift card from me it would be grand theft or larceny. Why should the Government take it because I am saving it for a rainy day? It is my money, I earned it, they have no right to it.
Comment by Cedar in USA — September 10, 2009 @ 3:06 am