Low Fees on Store-Branded Gift Cards

Quick, what's better: A store-branded gift card, or an all-purpose one you can use anywhere?

According to Bankrate.com's annual Gift Card Survey released today, store-branded gift charges have fewer purchase fees than those issued by banks and credit card companies.

Of the 55 store-branded gift cards surveyed-including Bloomingdale's, Whole Foods, Target, and Rite Aid-only 9 percent charged a purchase fee, and only 2 percent charge a maintenance fee. Conversely, all of the eight gift cards offered by banks and credit card companies (Discover, American Express, MasterCard, and Visa through various banks), charged a fee ranging anywhere from $2.95 to $6.95.

Federal law requires that gift cards stay good for at least five years, and 95 percent of the cards surveyed by Bankrate do not have an expiration date. Additionally, the survey found that two-thirds of gift card issuers will replace the card and/or money if it is lost or stolen. Seventy-five percent of the all-purpose credit cards charged a dormancy or maintenance fee (up to $3 per month) if the card is not used for a year or more, whereas only 2 percent of the store-branded ones did.

Bankrate.com rates 64 gift card programs here.

Moral of story? "Say you know who your gift recipient is and where they like to shop, you might want to go with a store-branded gift card because you don't have to pay extra, for the most part," Janna Herron, a credit card analyst at Bankrate.com, told ABC News. "But if you don't know where your gift recipient likes to shop, you might want to go with a general purpose card, which gives a lot of flexibility."

Or better yet: Give cash.