Unused Gift Cards – More revenue for Some States

Photo coutesy of Stock Xchange

Photo coutesy of Stock Xchange

Retailers who previously counted on unused gift cards as additional revenue may now find that they are in competition with the states for this revenue. Some states are now taking measures to enact legislation which would give the states the right to collect unclaimed gift card credit.

Consumers spend about $65 million in gift cards each year and fail to redeem $6.8 billion, reported Tower Group. Last year, New York state collected $9.6 million in gift cards. Some states treat unused gift cards as uncalaimed property and require retailers and third party gift card processors to keep a database on when gift cards are issued and used. They say this makes it easire for the owner of the gift card to get their money back. Additionally, some retailers sell the unused gift cards.

At a time when we are experiencing an economic crisis, we may see more of the states exercising this option to help offset the state’s deficit.


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