If you received a gift card last Christmas, you could be missing out on spending it because of hidden expiry dates. According to consumer group Fairer Finance, customers are losing over £300m a year due to gift cards running out.
After analysing 70 gift cards from the UK’s most recognised brands, it discovered 87 per cent carry expiration dates and of those, 75 per cent run out in two years or less. Of those that carry expiry dates, 75 per cent of them have details of their expiration hidden in the terms and conditions and FAQs. After the expiry date, any money on those gift cards is rendered useless.
Costa Coffee, RyanAir, Vue Cinema, Ticketmaster, JD Sports and Size? are among brands whose gift cards last 12 months and the details of their expiration dates were either only in the FAQs or in small print, according to the research.
By contrasts retailers such as IKEA, Selfridges, Starbucks, TK Maxx and Pizza Hut, however, offer gift cards with no expiration date, which gives holders the option to make a considered purchase rather than a rushed impulse buy days before it runs out. Amazon allows customers to spend their card balance for up to 10 years after purchase, while Argos has a three year expiry date clearly labelled on the card.
Fairer Finance also shared that if you have a gift card balance with a retailer that has gone into administration, such as House Of Fraser, Mothercare or Maplin, consumers almost never get their money back, with the majority receiving just 1p per £1 on their gift card, losing on average £83 each.
The organisation’s managing director James Daley said: “Hundreds of thousands of people will be receiving gift cards this Christmas – many of which will never get used because they expire, or the retailer goes out of business. There’s no good reason why shops should be allowed to add expiry dates to gift cards. The value of the card is eroded by inflation every day that a card goes unspent. And the likelihood of cards being used after a year is fairly low – as a significant number of cards are lost or forgotten. But for those customers who find an unused card a few years after it was given to them, there’s no good reason why they shouldn’t be able to use it.”
However, according to the UK Gift Card & Voucher Association, 98 per cent of consumers do redeem their gift cards within 12 months while 72 per cent spend more than the value on the card, adding 55 per cent on top of the average value of the card itself, proving that there are certainly some savvy shoppers out there.
So, while an easy win as a Christmas present if you’re unsure what to buy, make sure you’re aware of what you’re getting for your money by reading the terms and conditions carefully.