Cashable Vouchers? No Guarantee

Warning

"When you sign the deal, we'll give you a voucher that entitles you to claim most or all of the purchase price back."

A growing number of Canadian retailers have been running "cashable voucher" promotions to lure customers, boost sales and persuade buyers to pay the list price rather than negotiate the best deal.

The Competition Bureau is warning consumers to stop and think before spending their money on a big-ticket item on the basis a "cashable voucher". If you read the terms and conditions carefully, you will see:

The catch

• You have to wait a number of years to make your claim.
• You have to fulfill a number of strict conditions and file your claim within a limited time.

No guarantee

• Even if you meet all the conditions, there is no guarantee you will get 100% of the face value of the voucher; the size of the pay-out depends entirely on the number of successful claims.

People who use credit to buy that livingroom suite or luxury item, believing they will be able to pay off the bank or finance company when they get their cash back, could find themselves overextended and get a nasty surprise if they meet all the conditions and still receive only a fraction of the face value of the voucher.

Questions?

Ask yourself: "If I don't get all or any of my money back, will I be happy with the price I am paying today?"

Ask the dealer:

• Who is responsible for payment of the voucher - the retailer or the company issuing the voucher?
• How much money will be set aside to pay my claim?
• Where will that money be held, and subject to what conditions will it be held?
• What are all the conditions that I must meet in order to file a valid claim?
• If I file a valid claim, and it is accepted and processed, am I guaranteed to receive 100% of the face value of the voucher?

What you, the consumer, can do:

• Take the time to shop around and compare prices. Are you paying a premium price for the product on the basis of a promise of cash back that you may never see?
• Consider the costs of any extras or add-ons you are required to buy as a condition for obtaining a voucher. These may include administration fees, extended warranties, insurance fees, in-store financing or other products or service plans.

If you suspect you have been misled by a cash back or rebate program, or want information on the application of the Competition Act, please contact the Bureau's Information Centre at 1 800 348-5358, or visit our Web site at www.competitionbureau.gc.ca.

The Competition Bureau is an independent law enforcement agency that promotes and maintains fair competition so that all Canadians can benefit from competitive prices, product choice and quality service. It oversees the application of the Competition Act, the Consumer Packaging and Labelling Act, the Textile Labelling Act and the Precious Metals Marking Act.

For media enquiries, please contact:
Maureen McGrath
Senior Communications Advisor
Communications Branch
819-953-8982, or 613-296-2187 (cell)

For general enquiries, please contact:
Information Centre
Competition Bureau
819-997-4282
1-800-348-5358