DEBENHAMS shoppers are being urged to use any gift cards they have while the retailer is still accepting them.
The department store chain went into a pre-packed administration this week, which means it will stay open while it searches for a buyer.
Getty Images – Getty Debenhams shoppers are being urged to spend gift cards now
This means all 166 Debenhams stores will continue to trade as normal with gift cards, orders and returns still being accepted as usual.
It comes after the retailer rejected two bids to be bought out by business tycoon Mike Ashley, who already owns House of Fraser and Sports Direct.
It’s thought that the administration could put the jobs of 4,000 of Debenhams’ 25,000 strong workforce at risk.
Before the firm went under it had already earmarked 50 stores for closure because it’s struggling with debts of a whopping £720million.
Alamy Gift cards often become worthless when a retailer goes into administration
But while this is the case for now, things could change if the department store is unable to find a buyer or if a new buyer comes on board and changes things up.
With gift cards, while some firms have honoured them when they’ve gone into administration, others have made them invalid and some have changed their terms and conditions.’Get on down to the store now and spend them’
House of Fraser, for example, temporarily stopped accepting gift cards in store when it went into administration last year.
So experts are encouraging anyone with Debenhams gift cards to use them now.
Martyn James, a consumer expert at online complaints tool Resolver, said: “If you’re worried about what will happen with Debenhams and you have gift cards and vouchers, then don’t delay.
“Get on down to the store now and spend them. Because when a firm goes under, the vouchers often become meaningless.”
If you fail to use your gift card and Debenhams stops accepting them you’ll have to file your request for to get your money back to Debenhams administrator – if one is appointed.
You’ll then likely become one of a long line of creditors owed cash by the retailer with no guarantee of ever getting your money back.
What isn’t covered by Section 75?SECTION 75 of the Consumer Credit Act is a law shoppers can use to get their money back from their card provider if they spent more than £100 on credit card but didn’t get what they paid for.But there are a few things you need to be aware of:
In circumstances when you’ve paid for goods through an agent or a third party, then you may not be able to claim under Section 75. For example, if you buy concert tickets direct from the venue with your credit card, then Section 75 may apply but if you bought them via a ticketing agency then it may not. This is because the card provider could argue that as the payment wasn’t paid directly to the supplier of the goods or service, it doesn’t apply, as it doesn’t have a “direct relationship” with them.
Another grey area is when you pay with your credit card through services such as PayPal. PayPal also has its own refund system, so consumers should use that in the first instance – but you’ve only got 180 days from making the purchase to raise a dispute.
Although Section 75 doesn’t cover debit cards or payments under £100, there is another refund scheme which can help called chargeback. This however isn’t a legal right, so if you’re making a big purchase it’s always best to use your credit card to make sure you’re covered.
‘I would be very careful ordering something now’
MoneySavingExpert.com founder Martin Lewis also warns shoppers not to buy any new gift cards from the retailer.
He said: “Clearly, Debenhams is not in the most stable state at the moment. So personally I wouldn’t be buying anyone any gift vouchers from there in the future.”
Mr Lewis also says shoppers should be careful about what they order or buy from the retailer and recommends they make purchases on card so they’re protected if something goes wrong.
He added: “I’d also be very careful if I was ordering something now for delivery a decent amount of time in the future, and buying any items that might break down because returns can be difficult too if a firm goes bust.
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“Having said that, if Debenhams is at the right price and right place for you, and you want to buy something there, there are ways to protect yourself.
“If goods are over £100, buy them on a credit card – although do repay in full – so that you get Section 75 protection, and otherwise pay on a debit card or credit card to get chargeback protection.
“I would certainly be wary of paying for any larger items with cash or cheque because that gives you no protection at all.”
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