Editing Stored-value card (section)

===Closed system prepaid cards===
Closed system prepaid cards are cards issued by a merchant and may only be redeemed for purchases from the merchant. They are typically of fixed amounts and are commonly known as merchant gift cards or store cards. These cards are typically purchased to be used as gifts, and are increasingly replacing the traditional paper gift certificate.

Generally, few if any laws govern these types of cards. Card issuers or sellers are not required to obtain a license. Closed system prepaid cards are not subject to the [[USA PATRIOT Act]], as they generally cannot identify a customer.

As debts owed to consumers who purchased the card, these purchases remain on the books of a merchant as a liability rather than an asset. Consequently, gift certificates and merchant gift cards have fallen under state [[escheat]] or [[Lost, mislaid, and abandoned property#Recent developments|abandoned property laws]] (APL). However, the emergence of closed system prepaid cards has blurred the applicability of APL. North Carolina and Illinois have excluded these types of cards from APL provided the card has no expiration date or a service fee. Maine and Virginia require the issuer to pay the state when the cards are abandoned. In Connecticut an issuer is required to identify the residence of the gift card owner. Since most merchant gift cards are anonymous, the residence of the card's owner is deemed to be the state's treasurer's office.

Presently, no law requires a merchant to provide refunds for lost or stolen cards. Whether a refund is possible is specified in an issuer's cardholder agreement. In addition, most closed system cards cannot be redeemed for cash. When a cardholder redeems all but an insignificant portion of the card on merchandise, that amount is generally lost and is a windfall gain for the issuing merchant. The merchant also obtains a windfall gain if a card has an expiry date and the cardholder fails to use the full value by that date. Furthermore, the merchant has an interest-free use of the value until it is redeemed.