One of the common questions that readers have been asking me over the past few weeks is “is it safe to buy someone a gift voucher this Christmas?” During these uncertain times caused by the pandemic, this is a very good question. Here is what you need to know:
The big risk
When you buy a gift voucher from a retailer, it usually becomes worthless if the retailer goes bust before the voucher has been redeemed. On some occasions consumers are given a short period of time to redeem vouchers after a retailer goes under, but this is rare and there are never any guarantees that this will happen.
In today’s climate buying a gift voucher is therefore very much a lottery, as we have seen retailers of all sizes on the High Street going bust.
Gift vouchers almost always come with an expiry date, a fact that many recipients overlook. It is also worth noting that the clock starts ticking, in relation to the expiry date, the moment you purchase the gift voucher. So, if you are someone who is really organised with Christmas shopping and buys presents far in advance, the expiry period will be far shorter by the time the recipient receives the voucher.
Never buy a gift voucher that is linked to one single retailer, it is simply too risky. If you really want to buy a gift voucher, choose one which can be redeemed with multiple retailers. Also consider doing the following:
- If the value of the gift card is greater than £100, use your credit card to make the purchase. This will give you the protection of Section 75, where you can make a claim against your card provider if something goes wrong.
- If the value of the gift card is less than £100, use your debit card to make the purchase. This will give you the opportunity to try to make a ‘chargeback’ claim if something goes wrong. However, there are time limitations with this, typically 120 days from the date of purchase.
- Ask the retailer if the recipient will have the right to get the expiry date extended. You can then pass this valuable information on to the recipient of your gift