Commissioner’s Blog: New national gift card rules a win for consumers

With Commissioner for Consumer Protection Penny Lipscombe

Gift cards are big money in Australia, both for their convenience and flexibility. Unfortunately an estimated $70 million is lost each year due to uncertainty about expiry dates.

Consumer Protection Western Australia received 116 gift card related complaints in the last year (September 2018-September 2019) with 26% of complaints about inability to redeem a gift card and 14% of complaints regarding issues with the expiry date.

To help prevent monetary losses and to make gift cards fairer for consumers, new national gift card rules around expiry dates and post-purchase fees and charges start in November 2019.

With the exception of a few limited use gift cards and vouchers, all gift cards bought from 1 November 2019 will automatically come with a minimum three-year expiry period, with the expiry date clearly marked on the card. Even if a trader states an earlier expiry date, it will be invalid and you will be entitled to the mandatory three-year period.

It will also be illegal for traders to charge post-purchase fees or administration charges that will reduce the value of your gift card, such as activation, account keeping and balance enquiry fees.

Traders will, however, be able to charge fees they would normally charge as part of a transaction, such as overseas transaction fees, booking fees, payment surcharges that reflect the costs of using the payment method, or fees charged to replace a lost, stolen or damaged card. They will also be able to charge an upfront fee for the purchase of the gift card. Whether you choose to accept that fee and proceed with the purchase will be up to you.

There are some exceptions to the new rules, such as cards sold for a good or service at a genuine discount and cards or vouchers given to customers as part of a limited promotion.

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