Gift card rorts with high fees just find out information and check balances

IT’S an industry that’s worth billions. But when it comes gift card, consumers are the biggest losers.

EXCLUSIVE

GIFT card users are being slugged exorbitant fees for asking simple questions about their card, including balance checks.

Issuers are forcing customers who make phone inquiries about their cards to pay up to $4.50 to speak with a call centre operator and an additional 50 cents to receive their card’s balance.

The cost of these inquiries are then deducted from the card’s balance.

Gift card customers are getting slugged to find out information about their card when contacting call centres.

On a $50 gift card this can mean charges of up to $5 can apply before even making a purchase, meaning the customer loses about 10 per cent of the value of their card.

Add to this the card purchase fee and activation charges some cards insist upon.

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Buried deep in the fine print of some gift card product disclosure statements it states a call centre fee applies, “when you call the customer support centre and speak to a consultant to make a request or obtain information that is available to you by logging into the prepaid service centre.”

The Australian gift card industry is worth billions of dollars.

The gift card industry in Australia is worth billions of dollars a year.

Consumer group Choice’s spokesman Tom Godfrey said consumers continued to be fleeced by operators charging ridiculous costs to use these cards.

Choice spokesman Tom Godfrey said gift cards are “an epic retail rip off.”

“Gift cards are an epic retail rip off,’’ he said.

“From short expiry dates to activation and call centre fees for checking your balance, gift cards are designed to benefit retailers.

“While a gift card my seem like a quick and easy purchase, in reality this piece of branded plastic is your ticket to terms and conditions.

“It’s time for all gift cards across the country to have a mandatory three year minimum expiry period.”

In NSW from March 31 new legislation will come into force that ensures all gift cards must have a three-year minimum expiry date — previously many short expiry dates applied catching unsuspecting customers out before they had used the card’s balance.

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Financial comparison website comparethemarket.com.au’s spokeswoman Abigail Koch said these latest charges were simply gouging customers.

Comparethemarket.com.au’s spokeswoman Abigail Koch said some gift card users will not know all the fees and charges attached to their card.

“Consumers would be shocked to find out that they may have to pay a considerable fee to speak with someone about their gift card,’’ she said.

“These fees penalise consumers unfairly, especially as they seem disproportionately high to the effort it takes to check a balance or answer a question.”

A Woolworths spokesman said they stopped selling the prepaid gift card in January last year.

@sophieelsworth