Are gift cards a bad present?
They’re one of the most easiest presents to buy – but are gift cards one of the worst present to give a loved one?
Around 34 million are purchased every year in Australia, but not all gift cards are created equal. There are certain traps – including super short expiry dates, purchase fees and other stringent rules to look out for when purchasing gift vouchers, warns RateCity.
The most common expiry date for a gift card is only 12 months, although some retailers including Bunnings, Apple, JB Hi-Fi have unlimited expiries or will even allow you to redeem the voucher even if it has expired.
But others are not so generous. Some cards offering as little as three months to make a purchase.
Apple, JB Hi-Fi and Bunnings gift cards are some of the best vouchers to give as presents with no expiry date attached to the card.
There has been some progress on gift cards in 2017 with legislation enacted in New South Wales earlier this year seeking to stop retailers limiting the redemption period – but that’s just one state only.
The Commonwealth Consumers Affairs Advisory Council estimated that up to 8 per cent of cards are never used, which equates to up to $200 million lost by consumers each year.
RateCity top picks | ||
COMPANY | EXPIRY DATE | CONDITIONS |
Bunnings | Unlimited expiry | If balance falls below $9.95 Bunnings will give you change in cash. |
Apple | Unlimited expiry | |
Netflix | Unlimited expiry | Requires new or existing Netflix account. |
JB Hi-Fi | Unlimited expiry | Will honour expired gift cards. |
The Good Guys | Unlimited expiry | Will honour expired gift cards. |
IKEA | 36 | Can be used in 23 countries. |
Beware of the fine print
COMPANY | EXPIRY DATE | CONDITIONS |
Youfoodz | 3 | Short expiry period. |
Some independent beauty salons | 3 | Short expiry period. |
Ella Bache | 6 | Short expiry period. |
Endota Spa | 12 | Charges you $10 delivery fee for the card. |
Westfield | 12 | Some retailers may choose not to accept the gift card. |
Sportsgirl | 12 | Gift cards cannot be used online. |
Ella Rouge | 12 | 50% of value will be deducted for cancellations within 24 hours notice. |
Bing Lee | Unlimited expiry | The gift card must be used in one transaction. |
Australia Post Visa Card | 24 | $5.95 purchase fee (up to 10% of card value). $4 fee for balance enquiry by phone. |
Myer | 24 | Charges you $4.95 delivery fee for the card. |
RateCity money editor Sally Tindall said even though gift cards are one of the most convenient presents to buy, shoppers should always read the fine print.
“Gift cards are meant to operate just like cash, but in reality they come with pages of terms and conditions that often work in the retailers’ favour,” she said.
“Short expiry dates are the biggest offender, but shoppers also get caught out with postage and activation fees and conditions on where and how the money is spent.
The other way shoppers end up losing cash is by only spending part of the value of the gift card. Often the balance left behind is never spent, and when the card expiries, retailers keep the difference.
And with around 2.5 billion spent annually on gift vouchers that a huge chunk of cash lost.