Consumers have been warned to “think twice” before buying gift cards for Christmas after nearly one in ten received a voucher for a bankrupt retailer in the last year.
Which? surveyed 2,000 consumers and found that 7% received a gift card for a merchant who has been broke since March 2020.
Almost two fifths (38%) of these consumers were unable to redeem all of their voucher, with an average of £ 25 unspent.
One in five (21%) of those with vouchers for busts dealers had a gift card for an Arcadia group dealer.
Some of these retailers, including Topshop and Miss Selfridge, only allowed their customers to pay 50% of their total order amount with gift card credit after they got into administration after Christmas last year, while shoppers had to fund the other half with their own money.
Which? warned administrators can opt out of gift cards at any time to save a troubled retailer.
The organization also found that some retailers are better at indicating than others when their gift cards expire.
More than half of those who received a gift card in the past year (53%) had a clear expiration date, while a quarter (27%) said the expiration date was not clearly stated on their cards.
The most common reasons respondents wouldn’t issue a gift card were not getting around to using it (42%) and not finding anything to spend it on (28%).
Which? Consumer rights spokesman Adam French said, “Which ones? advises consumers to think twice before buying gift cards this holiday season.
“While gift cards may seem like a simple present for a hard-to-please family or friend this Christmas, our research shows that if the company went bust, you could be left by the wayside.”
The Gift Card and Voucher Association said, “Given the economic turmoil of the past year and a half, it is understandable that consumers should be cautious. However, gift cards remain the ideal choice for an ever growing number of shoppers, with the gift card market valued at around £ 7 billion according to the latest industry assessment.
“With a view to the future, gift cards and vouchers are often the most convenient and safest option for shoppers who want to avoid disappointment at Christmas and at the same time significantly reduce festive waste and unwanted gifts, especially in times of persistent delivery bottlenecks.”
Which? interviewed 2,000 British adults in October.
You can find more stories from where you live at Near you.