Survey: Consumers confused over gift cards
While more people are turning to general-purpose gift cards as stocking stuffers, a new survey finds very few actually know how they work, and the risks and costs associated with them.
The survey, commissioned by the Consumer Federation of America, found just 33 percent of Americans know how much the cards – most of which are issued by Visa, MasterCard, or American Express – cost to purchase, and 54 percent were aware that, six months to a year after their purchase, some charge a monthly fee.
The cards, which can cost between $4 and $7, are sometimes subject to monthly fees as high as $4.95 if they are not used after a certain amount of time.
“Consumers clearly like the convenience and flexibility of general purpose gift cards but also are largely unaware of their costs and risks,” CFA executive director Stephen Brobeck noted in a news release.
To educate consumers, the CFA and National Association of Consumer Agency Administrators created a new consumer brochure on gift cards. A copy is available at www.consumerfed.org.
The brochure recommends paying attention to the expiration date and charges, and to use the cards as soon as possible.
It notes that some 10 percent of a card’s value is never used, and an additional percentage is lost through the monthly fees.
