Gift Card Cash-Out Threshold Jumps to $15 in California

by: Joyce Kim

Many states require gift card issuers to redeem low-balance gift cards for cash upon request. As our previous posts have highlighted, we have seen these requirements enforced through lawsuits brought by local-government attorneys in California, as well as consumers.

Historically, California’s cash redemption threshold has been set at $10. Following amendments to California’s gift card law signed into law last week, California is increasing its cash redemption threshold to $15 effective next year, meaning that gift cards with values under $15 must be redeemable for cash where requested by the cardholder. This $15 threshold is notably higher than most other states with gift-card laws that include a cash-out requirement, where cash redemption requirements typically apply to balances of $5 or less. The CA amendments also explicitly add an exemption for gift cards donated to nonprofits or charitable organizations, subject to certain on-card disclosure requirements. While these amendments do not come into effect until April 1, 2026, gift card issuers should be aware of these changes to come and take steps to implement processes to account for the new cash redemption threshold in California.  

Originally published by InfoLawGroup LLP. If you would like to receive regular emails from us, in which we share updates and our take on current legal news, please subscribe to InfoLawGroup’s Insights HERE.