The Federal Reserve Board has delayed by about five months the implementation of some disclosures governing gift cards.
Disclosures that were supposed to take effect Aug. 22 regulating gift cards, certificates and general-use prepaid cards will now take effect Jan. 31, 2011, to permit the sale of existing cards, the Fed said Wednesday.
"The consumer doesn't lose any of the protections of the act as of Aug. 22," said Terry Maher, a general counsel for the Network Branded Prepaid Card Association in Montvale, N.J. "It just allows those cards not to be destroyed and the consumer will be notified that they do have all the protections even though the card may not say it."
The gift-card rules restrict issuers' imposition of dormancy, inactivity or service fees on gift cards. The Fed is delaying disclosure of some rules because Congress passed legislation postponing the effective date for cards produced before April 1, to let merchants sell their existing stocks.
The older cards must still comply with the rules.
The changes are part of the Credit Card Accountability, Responsibility and Disclosure Act. Provisions of the law already in effect include giving credit card holders the right to reject rate increases within 45 days and to pay off balances at current rates. Companies also must mail bills 21 days before due dates, up from 14 days.
