GiftCardRescue.com, a company that allows visitors to sell or exchange unused gift cards, announced Monday that it has instituted a new bankruptcy protection policy that will cover customers who purchase gift cards from the company's site.
"The current economic downturn is causing anxiety among consumers about whether a gift card purchased today will be redeemable tomorrow given the recent surge in bankruptcies by retailers," Kwame Kuadey, GiftCardRescue's CEO and founder, said in a statement. "This policy is to reassure our customers that their gift card losses from bankruptcy will be covered."
According to the company, GiftCardRescue will reimburse a customer's gift card if the retailer goes bankrupt within a year of the gift card purchase, as long as the retailer is no longer honoring gift cards. Kuadey said his company will cover the cost of the insurance with its own cash reserves and will not pass it on to the retailers or customers.
GiftCardRescue also announced Monday that it will start keeping tabs on retailers through its GiftCardBlogger blog. The site will will feature updates on retailer bankruptcies and their impact on gift card holders.
Gift card sales were one of the hottest buys during last year's holiday shopping season, but economic troubles mean gift cards may not top the list this year. The National Retail Federation announced last Tuesday that gift card sales are expected to drop 6 percent this holiday season.