New Gift Card Terms A “Significant Cost” To Retailers
Retailers in NSW have six months to update their systems, to comply with new gift card expiry terms – a fact the Australian Retailers Association states will incur a “significant cost” to businesses.
Last year, the NSW government announced its plans to release legislation which would standardise gift card expiry terms to three years, claiming too many consumers are losing out by failing to redeem within twelve months.
The ARA’s Executive Director, Russell Zimmerman, reportedly sent a submission to the New South Wales Office of Fair Trading, affirming that plans to roll out the changes in March, with a six-month transition period, represent a “significant hit to retailers leading into the busy Christmas trading period”.
The ARA states there’s limited “needs-based” evidence to support the legislation being a priority. It warns that the decision to phase in the new laws between March and September may cause undue pressure on retailers, who have to quickly update processes and systems.
As said to SmartCompany, Mr Zimmerman affirms that the proposed changes will place an unnecessary burden on retailers:
“The retail industry would prefer a voluntary code of conduct on these gift card regulations as placing an unnecessary regulatory burden will only cause more administrative costs and confusion for both retailers and consumers”
“The ARA have been advocating for a 12-month transition period to assist retailers with this new unnecessary regulatory burden, as the majority of retailers are already carrying excess stock of gift cards”.
The industry body also asserts that the emphasis on NSW consumers is confusing, with many gift cards sold across Australia:
“The ARA is concerned about the onus placed on retailers for asking for and checking identification of consumers purely for the sale of a gift card or voucher, particularly when issued from interstate”.
Council of Small Business Australia Chief Executive Peter Strong informed SmartCompany it would be “much more sensible” to “get all states to say, ‘these are the rules’”.
NSW State Minister for Regulation, Matt Kean, states that the changes are about putting consumers first:
“This is all about putting consumers first and I call on businesses to put their customers first by extending expiry dates across the country”.
After coming into effect on March 31st, the government claims that NSW consumers will be $60 million better off.