Giving gift vouchers is still one of the most popular Christmas gifts and the giver can rest assured that the recipient will get exactly what he or she wants.
That is, unless they can’t use it because they didn’t know what the expiry date was and didn’t use it in time. Or maybe you will receive a voucher, lose it somewhere or promptly put it in your drawer and forget about it.
And what if you receive a generous gift card, don’t use it until after a year and then discover that a charge is being debited from the card each month.
From Tina’s slot on RTE Radio 1′s Today with Pat Kenny, 13th December 2012.
In Deloitte’s Consumer Survey of Christmas spending for this year, the popularity of gift vouchers had fallen from third place to fifth place overall on adults’ ‘wish list’ for Christmas this year.
Nonetheless gift vouchers still scored 33%, after cosmetics / perfumes (35%), clothes/shoes (35%), cash (37%) and books (46%). However when you analyse the age groups, in the 55 to 64 age category gift vouchers appear in second place as ‘most wanted’ after books.
Are gift vouchers regulated?
There is no specific consumer legislation or regulations governing gift vouchers. That means that whatever terms and conditions the shop imposes on the use of the voucher is what you are agreeing to adhere to when you buy it.
As a matter or interest, back in November 2009 then Labour Senator Brendan Ryan (now a Labour TD) introduced a gift vouchers bill that proposed to regulate their terms and conditions but nothing came of it.
So, there are several key things that you must know about gift vouchers or gift cards so that you don’t lose out on what should be a lovely gift.
What you need to know about vouchers
1. How long can I use my voucher for?
Without regulation that all depends on the shop in question. The deal is between you and the shop, so it is up to them how long the voucher will be valid for.
In some shops there is no clear policy or consistent approach on expiry dates, which is dreadful. Other stores have a clear policy by printing it on the voucher itself or by making it clear on their website, in-store leaflets and posters and this is much better. Better yet some stores are more flexible and have no expiry date on their vouchers.
How to avoid risk:
- If it is not clear always ask what the expiry date is and tell this to the person you are gifting.
2. Can I use my voucher past the expiry date?
No you can’t. If you get a voucher for Christmas that has a six month expiry and go to use it in July, you have broken the terms and conditions so they don’t have to accept it. Having said that, always ask for the store’s goodwill and they may just say yes.
But if you forget to use it after expiry it means that the retailer wins out by getting to keep your cash and give you nothing. UK research published this year found that £250million a year was wasted on unused gift cards.
There is clearly also huge waste from gift cards in the US too as several state governments have passed laws subjecting gift cards to the same rules that cover unclaimed bank accounts and other property there, which means that the unused cash goes to them to put to budget shortfalls etc. (Note that here bank accounts can remain dormant for fifteen years before transfer to the NTMA/State).
But, if a shop refuses to honour a voucher that doesn’t specify an expiry date, and where one was not included in any terms and conditions, you have a valid case so complain to the shop and if that fails you have the option to refer the matter to the Small Claims Court.
How to avoid risk:
- Use your voucher as soon as possible
3. What can I do if I lose my voucher?
If you lose a gift voucher, the shop doesn’t have to replace it. It’s just like losing cash – so always keep the voucher somewhere safe. However, if the voucher was made out to you specifically and is not transferable to another person, the shop may be bound to issue you a new one and cancel the original voucher. For this you will need your receipt or proof of purchase, i.e. credit card statement.
But, if you buy some gift cards they will replace them if lost or stolen for a fee. For example, one4all gift card can be replaced for a €5 admin fee. However, you must have the card number, so if you receive one, write down the card number somewhere safe. Likewise, other pre-paid gift cards, such as you’ll find in most shopping centres, can be replaced is lost or stolen, generally for €7.50 or €8.
4. What happens if the business goes bust?
As a voucher holder your money is not ring-fenced or protected if a company goes bust. So, if the business closes you are classed as a creditor and must take your place alongside anyone else owed money by the business. And, unlike the banks and Revenue, you’ll be an unsecured creditor and that means you will be at the bottom of the queue. It would be extremely unlikely that you get anything back.
How to avoid the risk:
- If you get a voucher use it as soon as possible, no matter when the expiry date is. Don’t stick it in the bottom of a drawer.
- If buying a voucher you could get one for multiple stores (i.e. one4all or one for a shopping centre) as this will negate the risk of business closure.
5. Do some gift cards come with additional charges?
Yes they do, and you must be very careful about these. These gift cards, are in fact pre-paid debit cards, so the money is pre-loaded to the card. The sting is that they can come with extra charges that you need to know about.
One4all vouchers and gift cards can be used in 5,300 outlets so are very flexible. If you buy a one4all paper voucher it costs €2 (50c for additionals) to issue (€3.49 online) and will be valid of 12 months only. But if you buy a one4all gift card, while it also costs €2 (50c for additionals) or €3.49 online, it is apre-paid card and so if you don’t use it within the first 12 months, monthly charges will be debited after that. The monthly charge from month 13 is €1.45 which will be debited from whatever amount remains unspent until the amount is zero.
The same is true of many shopping centre gift cards:
Dundrum Town Centre, Paviliions Shopping Centre in Swords, Blanchardstown Shopping Centre and Galway Shopping Centre: €3.50 to purchase, €7.50 fee to replace if lost or stolen, €3 per month charge on any remaining vale from month thirteen.
Mahon Point shopping centre in Cork – this is also a pre-paid debit card but there is no fee to purchase. It costs €8 to replace if lost or stolen and like the others €3 is debited per month from month thirteen.
To find information on these fees you have to read the detailed terms and conditions, and that isn’t good enough as it isn’t as clear and transparent for consumers as it could be. On the plus side, if this type of card is stolen and funds used, you can be re-imbursed.
How to avoid the risk
- Know these charges are there and always use the card before the charge kicks-in, usually before twelve months is up.
Recap – top tips
- Always make sure you know how long the voucher is valid for. If this isn’t written on the voucher ask, and make sure you tell the person you are giving the voucher to.
- Also ask what happens to an unused portion of the voucher, if it can be used in every outlet (if it’s a chain) and if can be used North / South.
- Minimise your exposure to risk by buying a voucher for a chain or for more than one outlet.
- Use the voucher as soon as possible, don’t stick it in your bottom drawer.
- If you are given a pre-paid gift card, check the terms for any usage fees that may apply.