Bank refund may be available to consumers left upset over Dick Smith gift card trap

Longtime Australian electronics retailer Dick Smith Electronics went into voluntary administration with “considerable regret” yesterday, but it’s the customers with gift cards in their wallets who are left scratching their heads. In the latest blow to consumers, all Dick Smith gift cards have been rendered useless.

Upset customers have taken to the Dick Smith Facebook and Twitter pages to express their frustrations at the company selling gift cards right up until the very end of its downfall. Some media sites have also suggested that Dick Smith were purposefully offering discounts on gift cards in full knowledge of their pending administration, as early as last month.

RELATED: Bah, humbug! Consumer lobby concerned about gift card expiry dates 

Erin Turner from the consumer group Choice told the Australian Financial Review yesterday that customers who bought gift cards using their credit or debit cards should contact their bank for a potential reimbursement. She also suggested those who received Dick Smith gift cards for Christmas should speak to the gift giver.

"Talk to them about firstly getting non-gift card presents and secondly, ask them to seek a remedy for you and call their bank," Turner told the Financial Review.

The Chairman of Dick Smith, Rob Murray said that company sales performed “below management expectations” last month.  

But this comes as Dick Smith slashed their prices in the December shopping season up to the 80% mark, which its competitors were quoted in News.com.au as saying was a “suicidal” move.

Receivership of the company, Ferrier Hodgson made a call out yesterday for expressions of interest in search of a company buyer.

“Dick Smith is one of the best known brands associated with consumer electronics in Australia and New Zealand,” one of the receivers, James Stewart said.

The ACCC told Smart Company this morning that if you have concerns about your rights as a consumer over the Dick Smith saga to visit their help page because you may be eligible to register as an unsecured creditor.

<<UPDATE>> Coles announced that Dick Smith Gift cardholders who's cards were purchased from one of their stores can exchange it for something else.

The supermarket giant tweeted this morning to confirm the change of heart. "We'll exchange Dick Smith gift cards bought from 1 Jul 2015 for Coles gift cards if returned by 29 Feb 2016," the Coles Tweet said.

News outlets are also reporting that Dick Smith gift cards bought on electronics site Kogan.com.au are also eligible for an exchange.

If you want to stay away from the tumultuous retail climate with your gift giving, opt for the traditional cash in an envelope, or a prepaid travel card like Australia Post’s Load and Go. While this card is designed to be used with multiple currencies, you can still keep it in Australian dollars and the card recipient can use it like a regular gift card.