Giving or receiving a gift card – things you should be aware of!
When it comes to buying Christmas or birthday presents, Gift Cards can be an easy and convenient answer, especially when you can buy them online or pick one up at many retail outlets. Australians are also very adept at using them with over 34 million Gift Cards sold annually generating over $2.5 billion in sales.
For those receiving a Gift Card they can be a great choice of present as it enables you to buy exactly what you want from the issuing outlet, be it clothes, books, electronics or beauty treatments. But life’s busy and it’s easy to forget things and plenty of us have discovered that Gift Card in a drawer or in our purse or wallet that’s expired – often only a month or so before you come across it!
Collectively Australians are losing over $200 million each year from unredeemed Gift Cards with over $60 million being lost in NSW alone. They are also unfortunately a significant generator of consumer complaints with over 1,300 being made to the NSW Fair Trading over the last five years – mostly about expiry periods and undisclosed terms.
Unlike in Canada, where Gift Cards are not allowed to expire, until recently in Australia no law existed that provided a minimum period of expiry on Gift Cards. Only a handful of retailers voluntarily offered Gift Cards with no expiry date and most expired after 12 months. Some retailers imposed even shorter expiry periods and once the expiry date passed the issuing outlet was no longer obliged to honour the card or voucher. The only avenue of protection that’s been available for consumers was under the generic provisions of the Australian Consumer Law – as an example, some relief may be provided if the expiry date was considered unreasonably short. Consumers have also been able to use unfair contracts legislation to take action against particularly unfair terms and conditions for gift cards.
Fortunately in NSW there is relief on the horizon as all Gift Cards sold in the state will soon have a minimum three year expiry period. Recent amendments made to the Fair Trading Act 1987 will introduce a mandatory 3-year minimum expiry date on Gift Cards and Vouchers sold to consumers and businesses will also be banned from applying post-purchase administrative fees which have had the effect of reducing the balance left on a card.
It was hoped that the new rules would be operating in NSW for the 2017 Christmas trading period but Fair Trading has announced that they won’t now be implemented until 2018. If you’re considering buying a Gift Card as a present for someone or if you receive one before the new rules come into force here’s a Checklist of things to consider:
1. Expiry date
- Choose a card that doesn’t expire…
- …or go for one with a long expiry date, like two years.
- A few gift cards also allow a grace period after the expiry date or allow you to exchange an expired card for a new one.
- Ideally, you’d like to be able to check the card balance easily in-store, online or via phone. Beware of cards that charge a fee to check the balance.
- Look for a card that allows you to use it for an unlimited number of transactions until you’ve spent the whole amount.
- Minimum spend amounts can be an issue, especially if the retailer doesn’t give change, as there may be an amount left on the card that you can’t use.
4. Lost or stolen Gift Cards
- Treat your gift card like cash – if you lose it, it’s generally gone.
- Some retailers allow you to cancel and re-issue a lost card, sometimes for a fee. But conditions can apply, so hold on to your receipts for gift cards and jot down details such as the card number.
- As many gift cards can only be used in a specific store choose carefully and consider the likes of your recipient.
- Cards that can be used in a group of stores owned by the one entity can often make better gift cards given the variety of choices for use of the card.
- Shopping Centre cards can be used in an even wider variety of stores, but be aware that they may not be accepted by all stores in the Centre.
6. Fees and Charges
- Some cards charge an issue fee.
- Others may charge a fee for extending the expiry period or reinstating lost or stolen cards.
If you would like more information or require assistance or advice regarding your consumer rights in relation to Gift Cards or other purchases, please contact Ken Gray on 4731 5899 or email firstname.lastname@example.org.
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Giving or receiving a gift card - things you should be aware of