Editing Gift card (section)

==Pitfalls==
It has been argued that holiday giving destroys value due to mismatching gifts.<ref name=NYT>{{cite news | url=https://www.nytimes.com/2007/01/07/magazine/07wwln_freak.t.html?ex=1325826000&en=970d53de24147ae4&ei=5090&partner=rssuserland&emc=rss |author1=Dubner, Stephen J. |author2=Levitt, Steven D. | title=The Gift-Card Economy | date=7 January 2007 | work=The New York Times | access-date=21 February 2017 | archive-date=28 October 2017 | archive-url=https://web.archive.org/web/20171028090225/http://www.nytimes.com/2007/01/07/magazine/07wwln_freak.t.html?ex=1325826000&en=970d53de24147ae4&ei=5090&partner=rssuserland&emc=rss | url-status=live }}</ref> The most efficient way to keep value in gifting would be to give cash; however, giving cash in most cultures is not socially acceptable, except with children. Gift cards, to a degree, may overcome this problem, but have certain pitfalls. Some feel that the absence of the thought of selecting a specific gift makes a gift card a worse choice than a poorly executed but individual gift.<ref>{{cite web | url=http://www.consumeraffairs.com/news04/2006/12/bad_gift.html | title=Bad Gift Better Than Gift Card, Says Philosopher | date=18 December 2006 | website=consumeraffairs.com | access-date=17 June 2008 | archive-date=26 November 2012 | archive-url=https://web.archive.org/web/20121126003931/http://www.consumeraffairs.com/news04/2006/12/bad_gift.html | url-status=live }}</ref> New products in the gift card industry are evolving to tackle this "impersonal" pitfall of gift cards; new services launched by some service providers allows for customization and personalization of gift cards.<ref>{{Cite web|title=Ways to make gift cards have a personal touch - Holiday Guide|url=https://sections.chicagotribune.com/holiday-guide/2020/11/?article=3613876&output=html|access-date=2021-04-15|website=sections.chicagotribune.com|language=en|archive-date=15 April 2021|archive-url=https://web.archive.org/web/20210415175535/https://sections.chicagotribune.com/holiday-guide/2020/11/?article=3613876&output=html|url-status=live}}</ref>

Gift cards have been criticized for the issuer's ability to set rules that are detrimental to the purchaser or card recipient. For example, gift cards may be subject to an expiry date, administrative fees, restrictions on use, and absence of adequate protection in case of fraud or loss.<ref name=consumer/> Over time fees may nullify the value of a gift card. However, these issues have been addressed in recent years in some jurisdictions. In the [[United States]], many jurisdictions limit or prohibit all fees and expiration dates for gift cards. Furthermore, because such policies can negatively impact sales, most merchants have adopted and even advertise a no fee, no expiration policy for their gift cards, whether or not state laws require it. In 2011, an estimated 2.5% of gift cards were subject to an expiration date and 2.7% to post-sale fees.<ref>{{cite web |url=http://www.scripsmart.com/gift_card_report_2011 |website=ScripSmart |date=2011 |title=Gift Card Report |access-date=27 February 2012 |archive-date=21 February 2015 |archive-url=https://web.archive.org/web/20150221135850/http://www.scripsmart.com/gift_card_report_2011 |url-status=live }}</ref>

A quarter of gift card recipients have still not spent the card a year after receiving it, according to a [[Consumer Reports]] survey, and a majority of people say they end up spending more than the value of the card once they get to the store.<ref name=npr>{{cite news | url=https://www.npr.org/templates/story/story.php?storyId=97016449 | author=Keith, Tamara | title=Gift Card Warning: Check Retailer's Health | date=17 November 2008 | work=[[NPR]] | access-date=2 April 2018 | archive-date=9 September 2017 | archive-url=https://web.archive.org/web/20170909215328/http://www.npr.org/templates/story/story.php?storyId=97016449 | url-status=live }}</ref> On the other hand, consumers may try to use as much of a gift card as possible while avoiding spending money out of pocket, usually resulting in small values remaining on the card. Consumer laws in some places have addressed this. In Australia, a gift card can be exchanged for cash if there is a remaining amount that the business believes cannot be "conveniently used".<ref>{{Cite web |last=Commission |first=Australian Competition and Consumer |date=2012-09-11 |title=Gift cards & discount vouchers |url=https://www.accc.gov.au/consumers/advertising-promotions/gift-cards-discount-vouchers |access-date=2022-03-31 |website=Australian Competition and Consumer Commission |language=en}}</ref>

In the event of the bankruptcy of the issuing retailer, the outstanding value on gift cards is considered [[unsecured debt]], so the gift cards may become valueless.<ref name=npr/> If the company intends to continue trading, gift cards may be honoured even in bankruptcy.

===Use in fraud===
Retailers and other businesses are increasingly about what can be done to prevent gift cards from being exploited by fraudsters. Gift card information can either be stolen from their rightful owners by fraudsters or they can be purchased with stolen credit card information. In recent years, cyber criminals have increased their efforts to take advantage of fraudulent gift cards, as they are simple to exploit with automated brute-force bot attacks.<ref>{{cite web | url=https://www.csoonline.com/article/3196035/fraud/what-not-to-get-mom-for-mother-s-day.html | website=CSO Online | title=What Not To Get Mom For Mother's Day | date=11 May 2017 | access-date=15 December 2017 | archive-date=21 December 2018 | archive-url=https://web.archive.org/web/20181221183010/https://www.csoonline.com/article/3196035/fraud/what-not-to-get-mom-for-mother-s-day.html | url-status=live | last1=Francis | first1=Ryan }}</ref> The most common form of gift card fraud is the theft of card information for activated cards with an existing balance by attacking a retailer's systems which store gift card data. Once a gift card has been compromised, the fraudster will then check the balance through online customer portals before using the funds or reselling on the secondary gift card market.<ref>{{cite web| url=https://www.digitalcommerce360.com/2017/03/17/prevent-fraud-brute-force-online-coupon-gift-card-attacks/| website=Digital Commerce 360 from Internet Retailer| title=How to prevent fraud from brute force online coupon and gift card attacks| date=17 March 2017| access-date=15 December 2017| archive-date=21 August 2019| archive-url=https://web.archive.org/web/20190821115804/https://www.digitalcommerce360.com/2017/03/17/prevent-fraud-brute-force-online-coupon-gift-card-attacks/| url-status=live}}</ref>

[[Internet fraud|Digital scammers]] sometimes trick victims into buying gift cards, which are then stolen.<ref>{{cite web |url=https://www.bbc.co.uk/programmes/articles/2Tzc0tx39VBYtFzwcwf7w7F/amazon-gift-card-scam-2021 |title=Amazon Gift Card Scam (2021) |author=<!--Not stated--> |date=n.d. |publisher=BBC |access-date=9 May 2023 }}</ref><ref name = "Scam Interceptors S2E3">{{Cite episode |title=Series 2: Episode 3 |episode-link= |url=https://www.bbc.co.uk/iplayer/episode/m001lm6v/scam-interceptors-series-2-episode-3 |access-date=9 May 2023 |series=Scam Interceptors |series-link=Scam Interceptors |first=Rowland |last=Stone |network=[[BBC]] |station=[[BBC One]] |date=3 May 2023 |series-no=2 |number=3 |minutes=27 |quote=The scammer claims that to get the money back, Amazon will refund you via a gift card you buy online... Mark will in fact be the one buying the digital gift card, which the scammers will steal, and which is completely untraceable. }}</ref> For the scammer, they have the advantage of being completely untraceable.<ref name = "Scam Interceptors S2E3"/>

In 2023, the [[Federal Bureau of Investigation]] warned the public about gift cards which appear to have a [[sticker]] placed over the [[barcode]].<ref>{{cite web | url=https://www.fbi.gov/contact-us/field-offices/elpaso/news/fbi-tech-tuesday-protecting-yourself-from-fake-barcodes-on-gift-cards | title=FBI Tech Tuesday: Protecting Yourself from Fake Barcodes on Gift Cards }}</ref> The [[United States Department of Homeland Security]] launched Project Red Hook due to the billions of dollars of gift card losses generated by [[Triad (organized crime)|Chinese organized crime]].<ref>{{cite web | url=https://www.dhs.gov/hsi/insider/tackling-gift-card-fraud | title=Tackling the Rise in Gift Card Fraud &#124; ICE | date=7 February 2025 }}</ref><ref>{{cite web | url=https://m.youtube.com/watch?v=W3Su81KOuxw | title=A syndicate is draining billions from gift cards; a new federal operation aims to stop the scam | website=[[YouTube]] | date=22 May 2024 }}</ref>