Gift cards are better than unwanted presents, but with expiry dates as short as eight weeks and no protection if the retailer goes bust, they can quickly become worthless bits of plastic, a Which? investigation has found.
Retailers tell us to ‘treat gift cards like cash’ even though we can’t actually use them as we do real money – because most of them expire if you don’t use them quickly enough.
Which? has found that only a handful of retailers will let you spend money on a gift card indefinitely. The rest will pocket any leftover cash after anything from eight weeks to 10 years, and come with a variety of tricky terms as to when the expiry date actually applies.
Our table shows expiry dates for more than 40 major high street and online retailers.
How do I tell when my gift card will expire?
Retailers don’t always make this easy.
When Which? hit the high street to take a snapshot of UK retailers and the gift cards they offer, we were disappointed that Intimissimi doesn’t bother to warn cardholders when its cards will expire.
Confusingly the shop assistant at the Oxford St branch told us it would expire after 24 months, but when we called the Kings Road branch, we were told it was only valid for one year. Eventually, the company confirmed that regular gift cards are valid for three years.
Most retailers do add a warning to their gift cards, but if they calculate this from the date of purchase you’ll still be in the dark if they don’t indicate this date on the card itself.
We only found two gift cards that do this (Pandora and love2shop) so, unless the gift-card donor has told you when they bought it, you’ll have to check online or call the retailer.
It’s worth checking the exact terms of expiry too, as this will vary from one retailer to another:
- Some gift cards are only valid for a specific period of time from date of purchase (e.g. Amazon, Argos, Intimissimi, JD Sports, Pandora, Sunglasses Hut, Topshop, Westfield, Zara);
- Others refresh the countdown from the date of the last activity, which may or may not include balance enquiries, (e.g. Accessorize, Boots, Debenhams, HMV, Hotel Chocolat, John Lewis, Lush, M&S, Moss Bros, New Look, Next, Swarovski, Ted Baker, The Gap, Waterstones and WHSmith);
- One gift card we came across – the One4all multi-store card – even applies an ‘inactive balance charge’ of 90p per month after 18 months (from date of purchase). This fee is added every month until the value of the gift card hits zero.
Why do gift cards have expiry dates?
If the likes of Aldo, Apple Store, Disney, Foot Locker and Selfridges don’t feel the need to impose expiry dates, why do others?
It hardly seems fair that they profit from the original purchase, and then again if the recipient misses the deadline, or forgets about the gift card altogether – so we asked retailers with the stingiest terms to explain:
- Ocado: ‘We have recently changed our expiry date to a year…but the standard procedure is to re-issue any vouchers which have not been redeemed within this time period.’
- Pandora: ‘It’s a corporate decision and we experience that almost all gift cards are converted to jewellery within the expiry date.’
- Westfield: ‘Customers can at any point choose to extend the gift card for a further three months for a £9.95 admin fee, however discretion can be used for individual circumstances.’
- Love2shop: ‘There may be some extenuating circumstances when an extension to the expiry date may be appropriate. However, in the main, we take the view that customers can clearly see the expiry date on the card when purchased.’
What happens if I lose a gift card, or it’s stolen?
Retailers don’t have to reimburse you, but it’s worth checking the specific terms written on the card.
Although most cards simply state that the retailer will not accept liability for lost, damaged or stolen cards, some providers seem to offer some leeway on this:
- Disney: ‘Lost stolen or damaged gift cards cannot be replaced without required proof of purchase and complete gift card number.’
- Pandora: ‘If a replacement card is issued as a result of a lost, stolen, or damaged card, a fee (approx £5) will be charged to the Cardholder’.
- Topshop: ‘Register your gift card at www.topshop.com to protect the card against loss or theft.’
Can I return items if I paid with a gift card?
Yes, but some retailers will add the funds back to the card you used so you’ll need to keep that, even if there’s no money left on it (others will simply give you a new gift card to the relevant value).
What happens if the retailer goes bust?
When a retailer is in trouble, but still open for business, the administrators decide whether they will honour existing gift cards and vouchers (they are under no obligation to do so).
If it folds, any voucher and gift card holders become ‘unsecured creditors’. Unfortunately, this means you’re at the bottom of the pecking order and will only get your money back if there’s enough left after all the secured and preferential creditors have been paid.
You can increase your chances by getting in quick, and making a claim as soon as possible. And, if the retailer is bought up by another business, they may decide to accept previous gift cards and vouchers.
If not, you can ask the person who gave you the gift card whether they purchased it using a credit or debit card – they may be able to get a refund from the card issuer using:
- Section 75: if they paid by credit card and spend more than £100 (but not more than £30,000) the credit card provider is jointly liable with the retailer if something goes wrong.
- Chargeback: this applies to both debit and credit cards, with no limits on the amount that can be claimed, although there are time limits and it’s a voluntary card scheme (run by Visa, Amex and MasterCard), not legal protection as with Section 75.
The Law Commission presented a report before Parliament in July 2016 urging the government to improve consumers’ position when retailers become insolvent. It’s still awaiting a response.