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Gift card
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==Function and types== [[File:Gift card assortment.jpg|300px|thumb|right|An assortment of gift cards, many from U.S. national retailers such as [[Best Buy]], [[Target Corporation|Target]], and [[Home Depot]].]] A gift card may resemble a [[credit card]] or display a specific theme on a [[plastic card]] the size of a credit card. The card is identified by a specific number or code, not usually with an individual name, and thus could be used by anybody. They are backed by an on-line electronic system for authorization. Some gift cards can be reloaded by payment and can be used thus multiple times. Cards may have a serial number, [[barcode]], [[magnetic strip]], which is read by an electronic credit card machine. Many cards have no value until they are sold, at which time the cashier enters the amount which the customer wishes to put on the card. This amount is rarely stored on the card but is instead noted in the merchant's [[database]], which is cross linked to the card ID. Gift cards thus are generally not [[stored-value card]]s as used in many public transport systems or library photocopiers, where a simplified system with no network stores the value only on the card itself. To thwart [[counterfeiting]], the data is [[encrypted]]. The magnetic strip is also often placed differently than on credit cards, so they cannot be read or written with standard equipment. Other gift cards may have a set value and need to be activated by calling a specific phone number. Gift cards can also be individually custom tailored to meet specific needs. By adding a custom message or name on the front of the card, it can make for an individualized gift or be used as a gesture of appreciation towards an employee. Gift cards are divided into open loop or network cards and closed loop cards. The former are issued by banks or credit card companies and can be redeemed by different merchants, the latter by a specific store or restaurant and can be only redeemed by the issuing provider. The latter, however, tend to have fewer problems with card value decay and fees.<ref name="consumerreports">{{cite web|url=http://consumerreports.org/holiday-shopping/tips-for-giving-gift-cards/|title=Avoid gift card pitfalls|date=December 2007|website=Consumer Reports|access-date=16 June 2008|archive-date=7 August 2016|archive-url=https://web.archive.org/web/20160807041828/http://consumerreports.org/holiday-shopping/tips-for-giving-gift-cards/|url-status=live}}</ref> Card value decay is less of an issue since the [[Credit CARD Act of 2009|Credit Card Accountability Responsibility and Disclosure (CARD) Act]] was passed by the US Congress in 2009. Inactivity fees and card expirations are both limited by the new law.<ref>{{cite web|url=https://www.ncsl.org/research/financial-services-and-commerce/gift-cards-and-certificates-statutes-and-legis.aspx|title=Gift Cards and Gift Certificates Statutes and Legislation|date=April 22, 2016|access-date=14 January 2020|archive-date=13 January 2020|archive-url=https://web.archive.org/web/20200113110736/https://www.ncsl.org/research/financial-services-and-commerce/gift-cards-and-certificates-statutes-and-legis.aspx|url-status=live}}</ref> In either case the giver would buy the gift card and may have to pay an additional purchase or activation fee, and the recipient of the card would use the value of the card at a later transaction. A third form is the hybrid closed loop card whose issuer has bundled a number of closed loop cards; an example is free gift cards for a specific [[shopping mall]]. Gift cards differ from [[scrip]] gift certificates, in that the latter are usually sold as a paper document with an authorized signature by a restaurant, store, or other individual establishment as a [[voucher]] for a future service; there is no electronic authorization. A gift certificate may or may not have an expiration date and generally has no administrative fees. Bank issued gift cards may be used in lieu of checks as a way to disburse [[rebate (marketing)|rebate]] funds. Some retailers use the gift card system for refunds in lieu of cash thereby assuring that the customer will spend the funds at their store. A [[charity gift card]] allows the gift giver to make a charitable donation and the gift recipient to choose a charity that will receive the donation. Gift cards can also be country-specific, and can be used to access USA-specific programming and media when outside the United States. ===Mobile and virtual gift cards=== [[File:App Store Gift Card by Zihexin.jpg|thumb|An [[app store]] gift card display in a shop]] {{unreferenced section|date=May 2019}} Mobile gift cards are delivered to mobile phones via [[email]] or [[SMS]], and phone apps allow users to carry only their cell phone. Virtual gift cards are delivered via email to the recipient, the benefits being that they cannot be physically lost and that the consumer does not has to spend the additional time needed to buy a physical gift card in a brick and mortar store making it more convenient. Gift cards of this type can also be purchased quicker, which is especially attractive if a gifting occasion is on the horizon. Other companies have introduced virtual gift cards that users redeem on their smartphones. As the merchant is not involved in the loop, it is considered a cash transfer rather than a traditional gift card.
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