SA businesses ignoring CPA provisions on vouchers and gifting
Disturbingly, many merchants are still issuing vouchers valid only for six or 12 months, as if the CPA doesn’t exist
Almost half of US consumers 46% forget to use their gift cards before they expire, and 3% of this gift card value in the US goes unused every year. In 2021, that unused spend was valued at about $15.6bn (about R296bn).
Those stats feature in this year’s market data report by US-based independent market research platform Gitnux.
If there is similar data on the SA gift voucher market, I haven’t been able to find it. But I think it’s fair to say that businesses that issue gift vouchers get a pleasing boost to their bottom line every year, thanks to recipients failing to redeem them before they expire. That’s despite the validity period being three long years, thanks to the Consumer Protection Act (CPA).
Or perhaps because of it it could be that some people lack urgency when they know they have three years to redeem a voucher and then forget all about it. Clearly, gift vouchers are a “win” for retailers they get paid up front, in full, for goods or services they have to provide only up to three years later, if at all.
Disturbingly, many merchants are still issuing vouchers valid only for six or 12 months, as if the CPA doesn’t exist. Some appear to be a bit put out when vouchers are presented, as if they are being required to supply the goods or services for free.
And then there are those who impose restrictions without any legal justification. Such as in the case of vouchers issued with a monetary value as opposed to a specific service refusing to allow vouchers to be used if the service in question has been discounted, or on products sold by the company. The CPA makes no allowances for such exemptions.
More worryingly, some companies have started saying in the large print that their vouchers are valid for three years while burying in the small print a provision stipulating that, if the price of the specified goods or service has gone up between the time the voucher was purchased and when it is redeemed, the holder will have to pay the difference.
Absolutely not. The gall!
Natalie Dupen, of Durban, paid Experience Days for two vouchers for a “supercar driving experience”
one for her father and the other for her husband in April and December 2021 respectively.
She paid R5,000 for the first one and R5,750 for the second. When her father tried to redeem his voucher earlier this year, he was told he had to pay an extra R6,000 for the driving experience more than the voucher had cost his daughter.
That’s when Dupen was directed to the fine print: “Vouchers are valid for the experience purchased for twelve (12) months from the date of purchase, but in the cases of vouchers not redeemed within 12 months, the voucher will revert to their original paid value. Therefore, to book the original experience after the first 12 months, a price increase may need to be paid.”
The company’s sales and operations manager told
Dupen in an email earlier this month: “Your options are to either redeem for the original experience and pay the difference in price, or exchange and use the credit against something else of equal value or less if you do not wish to pay extra.”
Later she was given a third option: to combine the value of the two vouchers to give just one of the men the supercar driving experience.
Those terms do not comply with the CPA, which makes them legally invalid.
I attempted to get a response from Experience Days, emailing both their sales and operations manager (twice) and their social media and marketing manager, but I’ve had no response. And there is no phone number on their website.
I’ve suggested to Dupen that she lodge a complaint with the consumer goods and services ombudsman.
In another case, in January last year, Candice Theunissen was given a R1,500 Life Day Spa voucher, which came with a very limiting restriction.
When she tried to redeem it at the Century City spa in Cape Town, she was told it could not be spent on “promo” offerings, only on full-price treatments.
When I took a look at the company’s terms and conditions online it has several spas in Gauteng and the Western Cape I spotted another problematic clause, which provided that vouchers are valid for treatments “at the current price” and “the holder of the voucher will be liable to pay any shortfall on the new price of the treatment on the day of presentation”.
In response to my media query to Life Day Spa, Monique Botha, manager of the Century City spa, said: “This was one of our [terms and conditions] as a business. However, we have changed this ... clients can now use our vouchers on treatments, promotions and purchas[es] of products.”
Good call and one hopes the clause requiring voucher holders to pay extra for specified treatments within the three-year validity period will also be removed.
Before buying a friend or loved one a gift voucher, check that the company is doing it the legal way: valid for three years, no top-up payments required and no bar on it being redeemed on a “special”.
And keep reminding the recipient not to let your spending go to waste.