The Federal Reserve announced final rules for gift cards Tuesday that the central bank says will help protect consumers from unexpected costs.
The rules, which go into effect in August, limit the fees that issuers are allowed to charge on gift cards, including inactivity, dormancy and other service fees. Issuers will also be required to clearly state the terms and conditions associated with gift cards.
Under the new rules, issuers will only be able to charge fees after a gift card or certificate has not been used for a year, and fees will be limited to one per month after that.
In addition, the Fed said issuers cannot charge fees unless the consumer has been given "clear and conspicuous disclosure" about them. The rules will also extend expiration dates for gift cards to at least five years after the date of issuance, or five years after the date when funds were last loaded.