Whether or not you have been shopping for a present for a beloved member of the family, or displaying your appreciation to your child’s trainer, there’s a superb probability you’ve bought a present card these previous few weeks. Client surveys present greater than 60% of us are prone to buy present playing cards over the vacations. Present card gross sales are large for U.S. companies, totaling practically $200 billion a yr. About half of U.S. adults have no less than one unspent present card, estimated to be valued at $23 billion nationwide, based on Bankrate.
I buy present playing cards for individuals I care about in my private life, however way more regularly, in my work. At Statewide Poverty Motion Community, we offer dozens of present playing cards each month to individuals with low incomes to thank them for serving to us form our coverage agenda by sharing their tales and experience round what it means to dwell in poverty in Washington.
Your present card comes from the guts, however chances are you’ll be shocked to be taught the place your cash finally ends up. Should you purchased your present card from Amazon or Walmart, corporations that integrated exterior Washington, after three years an unspent present card was probably declared unclaimed property. Unrecovered present card cash goes towards that state’s training, well being care or housing. In actual fact, greater than 70% of Fortune 500 companies return unspent present playing cards to the states the place they’re integrated.
But when your present card is from Starbucks, REI or Nordstrom, or different main retailers integrated in Washington, your cash is probably going padding their income, because of a loophole lobbied for by huge enterprise pursuits 20 years in the past. Benefiting from the loophole, these companies collectively saved roughly $255 million in unspent present playing cards final yr and counted it as income. Within the final 5 years alone, Starbucks has claimed $894 million in prospects’ unspent present playing cards as income, boosting company income and government bonuses. All of this cash might have been used to rent academics, construct housing, or present vital money help to assist low-income households meet their fundamental wants.
Incentivized by this loophole, some retailers are adopting predatory ways, corresponding to requiring excessive reloading minimums, refusing to money out present playing cards over $5, and never permitting shoppers to make use of present playing cards with different cost strategies.
Hope for shoppers and communities is on the way in which. The Washington Present Card Accountability invoice bundle, which will probably be launched within the upcoming legislative session, would require huge retail companies to make sure shoppers can get better their unspent present card funds by the state’s unclaimed property program. Banks, utilities, insurance coverage, mortgage corporations, and lots of different companies already ship unclaimed property to the state of Washington, which has returned $1.4 billion to shoppers. It’s time for large retailers to affix them by permitting shoppers to get better their unspent present playing cards.
The legislative bundle would require retailers with revenues above $25 million a yr to inform shoppers about unspent present playing cards over $50, and permit shoppers to money out present playing cards below $50. Retailers can be prohibited from setting excessive minimums for present card and cell app reloads, and shoppers can be allowed to pay with a mix of present playing cards and different strategies of cost. When a buyer spends a present card after its steadiness has been despatched to the state, the state will reimburse the retailer for that transaction. Present playing cards will nonetheless haven’t any expiration date.
The Washington Present Card Accountability measures will profit the general public by directing funds that stay unrecovered into very important public companies like training, well being care and housing — wants which are particularly urgent in our underserved communities.
The Legislature has a possibility to degree the taking part in area, defend shoppers and put money into the general public good. By closing the present card loophole, they will guarantee giant Washington retailers play by the identical guidelines that apply to corporations integrated in different states.
