Mandatory three-year expiry dates.
NSW Minister for Better Regulation Matt Kean has announced Australian-first gift card reforms with mandatory three-year expiry dates for all gift cards sold in NSW. The proposed plan would put up to $60 million a year back to consumers.
“When consumers hand over their hard-earned money, they rightly expect to get what they pay for. I am fed up of business taking money from shoppers and providing nothing in return, which is why I am putting consumers first and making sure they get a fair deal,” Kean said.
“Our plan will also stamp out further gouging of consumers through post-purchase fees and charges that reduce the balance on their gift card,” he added.
Kean said the Australian gift card market is worth up to $2.5 billion per annum, with about 34 million gift cards sold nationally each year.
“Most gift cards are offered with a 12-month expiry date; however, up to 8% of recipients do not use the full balance in time. This means NSW consumers are losing tens of millions of dollars a year and I just won’t stand for that.
“We have had more than 1,300 complaints about gift cards to NSW Fair Trading over the past five years – mostly about expiry periods and undisclosed terms and conditions.
“Receiving a gift card on a special occasion should be a fun experience, but instead it has become an unwelcome headache for shoppers, and it’s just not good enough. That’s why I am putting consumers first and proposing reforms that will make it illegal for businesses to issue gift cards with an expiry period less than three years.”
After consultation with key stakeholders, including retailer groups, a Bill is being prepared to put before Parliament. This will form part of an ongoing suite of ‘Consumers First’ reforms by the state government.
Commenting on the announcement, Choice head of media and spokesperson, Tom Godfrey said, “These reforms have been a long time coming and are a big win for NSW consumers. Unfortunately unfair expiry dates on gift cards cost consumers a small fortune each year.
“While a gift card might seem like a convenient and simple purchase at the point of sale, in reality you are often buying tricky terms and conditions your loved one will have to comply with. With these reforms making gift cards simpler and fairer for consumers, we hope it signals the beginning of the end of retailers cashing in at our expense.
“Choice believes three years is a reasonable expiry period for business to comply with, although it’s worth shopping around for cards without any time restriction. Although popular with consumers, these cards are a gift horse for retailers who can take advantage of inflation, changes in value and low redemption rates. The least these companies can do is offer a product that’s fair, including a minimum expiry with no sneaky fees. We would like to see these changes rolled out across the country to make gift cards fairer for all consumers.”