Gift cards: the gift that can stop giving

At this time of year, you might have given gift cards to family members who are awkward to buy for, rather than wasting your cash trawling the shops for something they probably might not have liked.

But then, this doesn’t always work out. I don’t mean to sound ungrateful, but I was once given a card for a store that really wasn’t my cup of tea. Needless to say the card expired in my wallet and ended up in the bin, leaving the retailer quids-in. However, the kind person who sent it to me was in the unhappy position of having spent out on something I didn’t benefit from.

The tides are turning…

So aside from my personal gripes; the real, burning issue with gift cards is that there’s next to no consumer protection on them. They aren’t covered by existing legislation, so if you have a gift card for a company that’s slipping into the abyss, the only thing you can do is spend the balance before they disappear (if they’ll even still accept them).

And the high street is clearly going through a huge amount of change. As more of us get savvy about shopping and use the internet to search out the best deals, traditional high-street retailers are suffering. You only have to look to the collapse of Game, JJB Sports, Zavvi, Peacocks and Comet to see this in action – and now the knives are out for HMV too.

Gift cards vs cash

These stores were among the first to shout about their gift cards, offering an easy way for customers to buy a gift that allowed the recipient to purchase something they’d actually want. But as more retailers are closing their doors, more and more gift card holders are getting left out in the cold.

The major benefit of gift cards – that they’re potentially a more thoughtful alternative to giving cash – can be overshadowed by the potential problems you face if your retailer goes bust. But if you do prefer to buy gift cards, you can try to spread the risk by buying cards that can be used across multiple retailers.

Did you buy anyone gift cards for Christmas this year? Or do you tend to avoid them in case the retailer goes bust?

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