Which? has urged consumers to think twice about buying gift cards over Christmas after its research found nearly one in 10 people had received one from a retailer that has gone bust since the start of the pandemic.

The consumer choice brand surveyed 2,000 people to find out issues that Brits are having when buying and spending with gift cards last year.

The research found that an estimated two million people have unused gift cards that they were given in the past year.

Seven per cent had received a gift card for a retailer that had gone bust since March 2020. Almost two-fifths – 38 per cent – of these consumers were unable to spend the full balance of their voucher – with an average of £25 left unspent.
One in five – 21 per cent – of those with vouchers for bust retailers had a gift card for an Arcadia Group retailer.

Some of these retailers, including Topshop and Miss Selfridge, only allowed customers to pay for 50 per cent of their order total using gift card credit after they fell into administration after Christmas last year.

According to Which?, administrators may refuse gift cards at any point in a bid to save a troubled retailer.

This was the case with Debenhams when administrators decided to stop accepting gift cards just before Christmas on 20 December, 2020.

One in eight – 13 per cent – survey participants who received a gift card for a retailer that went bust said they had a voucher for the department store in the past year.

“While gift cards might seem like an easy gift for hard-to-please family or friends this Christmas, our research shows you could be left high and dry if the company goes bust,” said Adam French, Which? consumer rights expert.“If you receive a gift card for Christmas, make sure to carefully check the small print to find the expiry date and make sure you won’t face any unexpected charges if you don’t spend your voucher quickly.”

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