Shoppers using popular supermarket Christmas savings schemes are now protected by a significant new consumer law that came into force at the start of the year.
What the New Consumer Law Means for Shoppers
From 1 January 2026, businesses operating consumer savings clubs are legally required to protect customer payments and provide clear information on how those funds are safeguarded. This legislation, part of the Digital Markets, Competition and Consumers Act 2024, directly impacts major supermarket loyalty programmes.
The new rules mandate that businesses must either place customer savings into protected trust accounts or take out specific insurance. This crucial measure is designed to shield consumers' money if a company faces insolvency.
Which Supermarket Schemes Are Covered?
The law covers several prominent high street savings schemes. Iceland's popular Bonus Club, which rewards shoppers with a £1 bonus for every £20 saved, is now under this protective umbrella.
Other major schemes included are:
- Tesco's Clubcard Christmas Savers
- Asda's Christmas Savings Card
- Sainsbury's Christmas Club Card
- The Co-op's Christmas Savings Stamps
The protection also extends to dedicated Christmas savings providers like Park Christmas Savings, ensuring even smaller, specialised clubs are covered.
Increased Transparency and Consumer Confidence
The Labour Party government stated that the law "fills a significant gap in consumer protection" for savings schemes that operate outside the regulated banking sector. A key requirement is for businesses to give clear and accessible information to customers about how their payments are protected.
The government's guidance clarifies that when it states a trader "must" do something, this is a legal obligation under the Act. Advice on what a trader "should" do represents best practice recommendations.
The primary aim is to boost transparency and rebuild consumer confidence, ensuring participants fully understand the safeguards for their hard-saved Christmas funds. Local authority trading standards teams will use this guidance for enforcement.
