In brief
California’s recent Senate Bill 22 (SB 22), effective on April 1, 2026, introduces new requirements for businesses that issue gift cards. SB 22 expands the existing law’s cash redemption requirements and broadens its scope. These changes make California’s gift card requirements among the nation’s most stringent and will prompt businesses to review and update their gift card policies, systems, and procedures to remain compliant.
In more detail
Increased cash redemption threshold: SB 22 raises the cash out threshold for gift cards from USD 10 to USD 15, requiring businesses to redeem gift cards for cash upon request when the remaining balance is less than USD 15. This change makes California’s cash out requirement the highest in the United States and will significantly expand the number of low balance gift cards eligible for mandatory cash redemption. The statute continues to recognize limited exceptions to the cash redemption requirement, including promotional cards provided to consumers for free, gift cards donated to nonprofit or charitable organizations, and gift certificates for certain perishable food products.
Express coverage of electronic gift cards: The law amends the definition of “gift certificate” to expressly include electronic gift cards. This amendment confirms compliance obligations apply to app‑based, online, and email‑delivered gift card programs, in addition to traditional plastic cards. Under the amended law, both physical and electronic gift cards sold for value are subject to the same core requirements, including mandatory cash redemption for low balances and longstanding prohibitions on expiration dates and most service or dormancy fees.
Takeaways
Businesses issuing gift cards in California should review their gift card programs to ensure compliance with the amended gift card statute. Companies with retail operations spanning multiple jurisdictions should also assess how California’s updated requirements interact with other state and local laws governing gift card cash redemption.