" Gift Card " rules !

The government has decided to make no change to the " expiry period " applicable to gift cards.  Decades ago, most cards lacked any sort of " use by " date, but limits crept in and today many cards have a twelve month period of acceptance, with a few extended to a maximum of two years.

It is a fact of life that about seven percent of gift cards are never presented for claim.  They get lost or forgotten, or perhaps they only apply to a line of merchandise not favoured by the recipient. In such cases, that card value is simply a bonus that goes directly into the merchants till.

The retail industry complained that mandatory extension on the life of gift cards would be an imposition on merchants.   They would be forced to make provisions on their books for demands on their stock which could take place over an extended period.    This ignored the fact that with gift cards, purchase of that stock has already been paid for.

It is not only card time limits that irk many people.  Some merchants impose conditions on gift card use that has no application in law.   It is not unusual for a merchant to claim that these cards can not be used on already heavily discounted sale items.    The whole concept of gift cards was for them to serve as an alternative for cash money.   Placing restrictions devalues that concept.   It could be likened to the  Mint stamping banknotes with an issue date - and reducing their value as legal tender as they aged.

The gift card allows us to avoid what some consider a breach of social etiquette by simply proffering money as a birthday gift.   It packages spending power in a more acceptable form.  It also solves the ever present dilemma of gift choice, particularly when the recipient is a teenager with unknown tastes in music or clothing.
The decision of choice is neatly transferred - and a problem is solved.

Unfortunately the whole gift card concept took a battering when the  Angus and Robertson chain closed it's doors.   Prior to the closedown, some branches honoured cards whilst others demanded that an equal amount of value be added to the purchase.  This made some people wary of cards that were accepted at only a particular retail chain as opposed to those issued by banking organizations and which are accepted  universally.

The government contends that the present situation is working well and that there is no need to implement new rules.  That assumes that the GFC does not extend to a " double dip " that sees a thinning out of the retail sector.   Consumer protection could be enhanced by demanding that clear and consistent rules be issued with each new gift card, detailing both the merchant and card owners rights and obligations of use.

To provide the ultimate protection, issuers of gift cards could be required to lodge the proceeds from such cards in a trust account, to be reimbursed monthly as card transaction apply.   In the event of a retail bankruptcy, card holders would be paid out from the trust fund.

Gift cards are a growing industry and in their present form there is scant protection, nor a clearly known and articulated code of use to guide both users and merchants.    Ignoring possible future problems is a sure way of guaranteeing that these problems will grow in size and complexity.