Retail giant Woolworths is scrapping the expiry dates on all its gift cards, giving shoppers the freedom to choose exactly when they want to use them.

Woolies says all gift cards for use at its supermarkets and other retail outlets will be sold without expiry dates from 31 March.

Expiry dates will also be lifted for Woolies gift cards bought from the end of March last year.

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Woolworths head of financial services and insurance Chris Cramond said the move goes further than the retailer's announcement in late 2017 to extend expiry dates from one to three years.

"After talking to more of our customers about this in recent months, we've decided to go one better and scrap gift card expiry dates for good," he said on Thursday.

"It means one less thing to worry about for our busy customers, who will have complete flexibility to use gift cards as and when it suits them."

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The change applies to gift cards for Woolworths supermarkets, Big W, Dan Murphy's, BWS, Cellarmasters and Caltex Woolworths Petrol.

Consumer advocate Christopher Zinn welcomed the move as a big win for shoppers.

"If you have a card spend it," he told the Nine Network.

"Far too many people hoard them."

The move by Woolies comes just months after the NSW Department of Fair Trading announced it would introduce a three-year minimum expiry limit for most gift cards used within the state from March 31 this year.

A study released by comparison website finder.com.au last August found that Australians waste $70 million a year on unredeemed gift cards.

Australians left an average of $54 each on gift cards, equating to a whopping $142 million in unused funds over two years.