Discount voucher scheme

Discount voucher schemes provide consumers with the opportunity to purchase a card or booklet of vouchers which entitles them to purchase goods and services from participating traders at a discounted cost or with some other benefit. Promoters of the scheme represent that consumers can make significant savings for a reasonably small outlay to purchase the card or vouchers.

Savings that consumers can make will depend on how many of the discounts they are able to use and this can be affected by a number of factors including:

• the location of participating businesses;
• conditions on usage. For example the discounts may only be available at certain times or on limited products;
• discounts may only be provided in conjunction with the purchase of another product or service at the full price;
• the participating business closes down or changes owners.

Before purchasing consumers should carefully review the discounts offered and any conditions to ensure they can get maximum benefit from the scheme.

Like most contracts, consumers may not be able to get a refund should they change their mind. However, in the event the scheme was misrepresented or conditions are being imposed which were not disclosed at the time of sale, consumers may be entitled to seek redress from the promoter.

For businesses, these schemes offer the opportunity to advertise and obtain new customers. However, before agreeing to participate businesses should consider how many of the cards or vouchers will be sold and what impact this may have on their business. Any conditions a business wishes to place on use of the discount should be clearly outlined.

Some discount systems revolve around sales recruitment schemes that are promoted by multi-level marketing. These schemes need to be closely examined to determine whether they are in breach of the pyramid sales provisions of the Fair Trading Act.