Are you one of the thousands of Australians who have finally found that Christmas gift card at the bottom of the kitchen drawer only to find it has expired?

After complaints dating back years, the New South Wales Government is set to introduce legislation into State Parliament forcing retailers to put a three-year minimum on gift card expiry dates.

Following a longstanding campaign by consumer advocacy group CHOICE, the New South Wales Better Regulation Minister Matt Kean said he would introduce the package of reforms into State Parliament this week, to stop retailers keeping an estimated $60 million a year across New South Wales as people failed to use their gift cards in time.

"I think shoppers deserve to get what they paid for. There is no expiry date on cash, why should there be on gift cards," he said.

"There are already companies like Bunnings and Apple who have no expiry dates on their cards. At least a mandated minimum period of three years will help consumers use their cards.

"These reforms have already been introduced in countries such as the United States, Canada and the United Kingdom."

People would be dependant on the goodwill of individual retailers to extend the allowed three-year period.

The fees charged for gift cards would also be examined.

Gift cards 'put terms and conditions on cash'

CHOICE spokesman Tom Godfrey said the changes were a good start.

Consumer advocates say gift cards are a "crummy" purchase because of the rules about their use. ( ABC News: Taryn Southcombe )

"Nationally, Australians are losing $200 million in unredeemed gift cards. They simply forget to use them in time or find that the expiry dates are simply too tight for them," he said.

"Sometimes people do not use their gift cards because of activation fees or too tight deadlines with some retailers imposing a period as little as three months.

"Fundamentally gift cards are a pretty crummy purchase. Fundamentally you are putting terms and conditions on cash. What these reforms are designed to do is make these products more consumer friendly."

The reforms would not cover companies that go out of business, like Dick Smith, leaving gift card holders as unsecured creditors.