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CNN Live Saturday
How To Avoid Giftcard Pitfalls
Aired December 06, 2003 - 12:47 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RENAY SAN MIGUEL, CNN ANCHOR: Well, if you are in search of the perfect present, the holiday gift card may seem like the way to go, but you cynics out there may already be thinking there's probably a pitfall or two. Shelley Curran is with the Consumers Union, it is her job to be cynical, but she's not trying to play Scrooge, she just tries to tell us about the things to look out for. She joins us now from San Francisco.
Shelley, thanks for being with us today.
SHELLEY CURRAN, CONSUMERS UNION: Thanks for having me.
SAN MIGUEL: Well, what is spurring the rise of these gift cards?
CURRAN: I think convenience is one quick answer to that question. When you sit down and think about what it is you are going to get for that family or friend and you're not quite sure, a gift card is a sure bet. It's convenient, it's easy to use and you don't have to hassle with returns.
SAN MIGUEL: They come in all kinds of dominations and increments. What is the catch? Is it just having to do with the fees associated with these?
CURRAN: I think some of it is the fees, yes. We would recommend to consumers to be very careful. Check the fine print. A lot of cards will have fees that are assessed every month for inactivity. Also, people need to look for whether or not, how long the cards will last.
SAN MIGUEL: I want to make sure, I hope this doesn't sound like too dumb of a question, but I want to make sure. The fee is assessed the person who bought the card as a gift for someone or to the recipient of the gift?
CURRAN: Both are a possibility.
SAN MIGUEL: Really?
CURRAN: For bankcards, typically, there can be a charge assessed up front. And then oftentimes for the person who actually receives the gift cards, fees can be assessed for inactivity or monthly maintenance fees. It's really important when you sit down to purchase that gift for somebody to read the fine print and see what the fees are going to be.
SAN MIGUEL: Boy, these are being marketed like hot cakes at the malls these days. Try the gift card. But the value on the card can change up until the expiration date, right?
CURRAN: Right. The value on the card can change again. Some charge a monthly maintenance fee beginning immediately. Others will charge a monthly maintenance fee after six months. Some don't charge them at all. Others assess some sort of maintenance fee or penalty fee if the cards are not used. So, really, sit down and take a look at it, both as the person who is giving the gift card and also as the person receiving the gift card.
SAN MIGUEL: Just how lucrative are these for the retailers these days?
CURRAN: This year people are projecting that it will be $45 billion of gift cards purchased. I think there's profits to be made both in the fees that are being charged and also when people don't actually use the gift card. The typical number is 10 percent of the value of gift cards is not used. If we're talking about $45 billion in gift cards that's excess of $4 billion in windfall for retailers and banks.
SAN MIGUEL: Some numbers to keep in mind as we're all going shopping.
Thank you so much, Shelley Curran, with the Consumers Union, we appreciate your insight.
CURRAN: Thank you for having me.
SAN MIGUEL: You bet.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com
Aired December 6, 2003 - 12:47 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RENAY SAN MIGUEL, CNN ANCHOR: Well, if you are in search of the perfect present, the holiday gift card may seem like the way to go, but you cynics out there may already be thinking there's probably a pitfall or two. Shelley Curran is with the Consumers Union, it is her job to be cynical, but she's not trying to play Scrooge, she just tries to tell us about the things to look out for. She joins us now from San Francisco.
Shelley, thanks for being with us today.
SHELLEY CURRAN, CONSUMERS UNION: Thanks for having me.
SAN MIGUEL: Well, what is spurring the rise of these gift cards?
CURRAN: I think convenience is one quick answer to that question. When you sit down and think about what it is you are going to get for that family or friend and you're not quite sure, a gift card is a sure bet. It's convenient, it's easy to use and you don't have to hassle with returns.
SAN MIGUEL: They come in all kinds of dominations and increments. What is the catch? Is it just having to do with the fees associated with these?
CURRAN: I think some of it is the fees, yes. We would recommend to consumers to be very careful. Check the fine print. A lot of cards will have fees that are assessed every month for inactivity. Also, people need to look for whether or not, how long the cards will last.
SAN MIGUEL: I want to make sure, I hope this doesn't sound like too dumb of a question, but I want to make sure. The fee is assessed the person who bought the card as a gift for someone or to the recipient of the gift?
CURRAN: Both are a possibility.
SAN MIGUEL: Really?
CURRAN: For bankcards, typically, there can be a charge assessed up front. And then oftentimes for the person who actually receives the gift cards, fees can be assessed for inactivity or monthly maintenance fees. It's really important when you sit down to purchase that gift for somebody to read the fine print and see what the fees are going to be.
SAN MIGUEL: Boy, these are being marketed like hot cakes at the malls these days. Try the gift card. But the value on the card can change up until the expiration date, right?
CURRAN: Right. The value on the card can change again. Some charge a monthly maintenance fee beginning immediately. Others will charge a monthly maintenance fee after six months. Some don't charge them at all. Others assess some sort of maintenance fee or penalty fee if the cards are not used. So, really, sit down and take a look at it, both as the person who is giving the gift card and also as the person receiving the gift card.
SAN MIGUEL: Just how lucrative are these for the retailers these days?
CURRAN: This year people are projecting that it will be $45 billion of gift cards purchased. I think there's profits to be made both in the fees that are being charged and also when people don't actually use the gift card. The typical number is 10 percent of the value of gift cards is not used. If we're talking about $45 billion in gift cards that's excess of $4 billion in windfall for retailers and banks.
SAN MIGUEL: Some numbers to keep in mind as we're all going shopping.
Thank you so much, Shelley Curran, with the Consumers Union, we appreciate your insight.
CURRAN: Thank you for having me.
SAN MIGUEL: You bet.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com
