Need to know
- Gift cards are just like cash and considered a prepayment – a retailer shouldn’t have the right to decide when you’re allowed to use them
- Nothing in the Australian Consumer Law gives retailers the option of rejecting a gift card for purchases
- After a backlash fueled by customer complaints and media reports, JB Hi-Fi has reworked its ill-conceived policy
(This story was updated on 9 October to reflect JB Hi-Fi's reversal on its gift card policy.)
In JB Hi-Fi's 2020 annual report, the company says "gift cards and store credits are considered a prepayment for goods and services to be delivered in the future".
But even though the goods have technically been paid for, JB Hi-Fi gave itself the right in recent days to choose which products gift-card holders can and can't buy before ultimately rethinking the policy.
That seemed pretty shonky to us, since gift-card credits are effectively cash.
With the gift-giving season not too far away, the gamers of the world, or their parents or caregivers, might well have their eyes on the new PS5 or Xbox Series X/S.
They may even have already put down a $50 deposit if they "were lucky enough to get a spot in the pre-order queue", as a JB Hi-Fi webpage puts it.
JB Hi-Fi calls its gift cards "a prepayment for goods and services", but until recently the company refused to accept them for popular new gaming consoles.
Your gift card is no good here
If you were planning to use a JB Hi-Fi gift card to pay off the balance for the new console, however, it would have been game over until the retailer's recent backflip on the issue.
A message on a JB Hi-Fi webpage, "using JB Hi-Fi gift cards to pay for your console will not be available", is what started all the commotion.
The JB Hi-Fi terms and conditions say gift cards "entitle the holder to goods/services equal to the value stated on the gift card or remaining after partial redemption". But they don't say anything about not being able to use one for certain purchases.
The company is at real risk of breaching the [Australian] Consumer Law here by misleading customersCHOICE head of policy Julia Steward
"Gift cards are meant to operate like cash," says CHOICE head of policy Julia Steward.
"Any onerous restrictions on gift-card use have to be clearly explained at the time of purchase," she says. "JB Hi-Fi has clear terms and conditions for gift cards with no information about restrictions. The company is at real risk of breaching the [Australian] Consumer Law here by misleading customers."
We contacted JB Hi-Fi for comment about refusing gift card purchases but didn't get a response.
New policy involves jumping through hoops
The electronics retailer says it's now accepting gift cards for purchases of the gaming consoles in question. But you still have to pay with a credit card, debit card or PayPal first and then submit a request to redeem your gift card.
JB Hi-Fi will then refund the money back to your card or PayPal, but it could take up to seven business days.
Got a JB Hi-Fi gift card and still can't use it? Here's what to do
- Lodge a complaint with JB Hi-Fi, pointing the company to its own terms and conditions for gift cards.
- If the company still says no gift cards, lodge a complaint with your state or territory consumer affairs body.
Stock images: Getty, unless otherwise stated.