Shoppers warned over giving Christmas gift cards as presents this year

SHOPPERS have been warned to avoid giving friends and family gift cards as Christmas presents this year.

Consumer watchdog Which? urged Brits to consider other options this year as gift cards can't be used if a retailer collapses.

Research by Which? found nearly one in 10 people had received a gift card for a shop which has gone bust since the pandemic started.

A survey of 2,000 consumers found 7% received a gift card for a retailer whichhas collapsed since March 2020.

Almost two fifths of these shoppers were unable to spend the full balance of their voucher – with an average of £25 left unspent.

One in five of those with vouchers for collapsed retailers had a gift card for an Arcadia Group retailer.

Some of these retailers, including Topshop and Miss Selfridge, only allowed customers to pay for 50% of their order total using gift card credit after they fell into administration after Christmas last year.

Shoppers had to fund the other half with their own money.

Administrators may refuse gift cards at any point in a bid to save a troubled business.

That's what happened with Debenhams when administrators decided to stop accepting gift cards just before Christmas on 20 December last year.

One in eight of the survey participants who received a gift card for a retailer that went bust said they had a voucher for the troubled department store.

Adam French, Which? consumer rights expert, said: “Which? is advising consumers to think twice before buying gift cards this festive season.

“While gift cards might seem like an easy gift for hard-to-please family or friends this Christmas, our research shows you could be left high and dry if the company goes bust.

“If you receive a gift card for Christmas, make sure to carefully check the small print to find the expiry date and make sure you won’t face any unexpected charges if you don’t spend your voucher quickly.”

What are your rights if a retailer collapses?

If you have a gift card for a retailer that goes bust, you could find it hard to get your money back.

When a firm collapses, administrators are brought in and they view customers as gift cards as creditors.

First of all, you should go to the shop and see if you can still use your voucher as some administrators will honour the purchase.

But otherwise you'll have to make a claim in writing with proof of your vouchers.

So, to get your money back, you’ll need to make a claim in writing to the administrators with proof of your vouchers.

If the gift card was purchased through a third party, you could also approach that business for a refund.

You won't be entitled to a refund but they could still repay you.

Another way to get your case back is to claim under the Consumer Credit Act but only if the gift card was worth more than £100 and paid for with a credit or debit card.

For vouchers under this amount, you could make a claim under chargeback rules to your credit or debit card provider but there's no guarantee that will work.

 

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