Editing Gift card

{{pp-vandalism|small=yes}}
{{short description|Prepaid-stored-value money card}}
{{Globalize|article|USA|2name=the United States|date=January 2013}}
{{Use dmy dates|date=July 2019}}
[[File:OSH gift card.jpg|thumb|Gift card for a U.S hardware store]]

A '''gift card''', also known as a '''gift certificate''' in North America, or '''gift voucher''' or '''gift token''' in the UK,<ref>{{Cite web|url=http://dictionary.cambridge.org/dictionary/british/gift-token|title=GIFT TOKEN|website=Cambridge English Dictionary|access-date=21 November 2018|archive-date=16 September 2014|archive-url=https://web.archive.org/web/20140916000953/http://dictionary.cambridge.org/dictionary/british/gift-token|url-status=live}}</ref> is a prepaid [[stored-value card|stored-value money card]], usually issued by a [[retailer]] or [[bank]], to be used as an alternative to cash for purchases within a particular store or related businesses. Gift cards are also given out by employers or organizations as rewards or gifts. They may also be distributed by retailers and marketers as part of a promotion strategy, to entice the recipient to come in or return to the store, and at times such cards are called '''cash cards'''. Gift cards are generally redeemable only for purchases at the relevant retail premises and cannot be cashed out, and in some situations may be subject to an expiry date or fees. [[American Express]], [[MasterCard]], and [[Visa Inc.|Visa]] offer generic gift cards which need not be redeemed at particular stores, and which are widely used for '''cashback''' marketing strategies. A feature of these cards is that they are generally anonymous and are disposed of when the stored value on a card is exhausted.

From the purchaser's point of view, a gift card is a [[gift]], given in place of an object which the recipient may not need, when the giving of cash as a present may be regarded as socially inappropriate. In the [[United States]], gift cards are highly popular, ranking in 2006 as the second-most given gift by consumers, the most-wanted gift by women, and the third-most wanted by males.<ref>{{Cite journal|last=HORNE|first=DANIEL R.|date=2007|title=Gift Cards: Disclosure One Step Removed|url=https://www.jstor.org/stable/23860062|journal=The Journal of Consumer Affairs|volume=41|issue=2|pages=341–350|doi=10.1111/j.1745-6606.2007.00084.x|jstor=23860062|issn=0022-0078|access-date=15 April 2021|archive-date=8 October 2020|archive-url=https://web.archive.org/web/20201008074238/https://www.jstor.org/stable/23860062|url-status=live|url-access=subscription}}</ref> Gift cards have become increasingly popular as they relieve the donor of selecting a specific gift.<ref name=consumer>{{cite web|website=consumeraffairs.com|url=http://www.consumeraffairs.com/news04/2006/02/gift_cards_congress.html |title=Congress Considers New Gift Card Rules |author=Hood, James R. |date=20 February 2006 |url-status=deviated |archive-url=https://web.archive.org/web/20120308094912/http://www.consumeraffairs.com/news04/2006/02/gift_cards_congress.html |archive-date=8 March 2012 |access-date=16 June 2008}}</ref> In 2012, nearly 50% of all US consumers claimed to have purchased a gift card as a present during the holiday season.<ref name=giftcard>{{cite web | url=http://www.giftcardlab.com/reports/2012-holiday-spending-report | title=2012 Holiday Gift Card Spending Report | date=26 November 2012 | website=giftcardlab.com | access-date=12 January 2013 | archive-url=https://web.archive.org/web/20131203041627/http://www.giftcardlab.com/reports/2012-holiday-spending-report | archive-date=3 December 2013 | url-status=dead }}</ref> In Canada, $1.8 billion was spent on gift cards, and in the UK it is estimated to have reached £3 billion in 2009,<ref>{{Cite web|title=Gift Cards and Financial Reporting|url=http://archives.cpajournal.com/2007/1107/essentials/p28.htm|access-date=2021-04-15|website=archives.cpajournal.com|archive-date=15 April 2021|archive-url=https://web.archive.org/web/20210415175035/http://archives.cpajournal.com/2007/1107/essentials/p28.htm|url-status=live}}</ref> whereas in the United States about US$80 billion was paid for gift cards in 2006.<ref>{{cite news|url= http://www.cbc.ca/news/yourview/2007/12/cash_not_gift_cards_the_best_p.html |archive-url= https://web.archive.org/web/20080524051343/http://www.cbc.ca/news/yourview/2007/12/cash_not_gift_cards_the_best_p.html |url-status= dead |archive-date= 24 May 2008 |title= Cash, not gift cards, the best present: consumers' association|work= CBS News|date= 24 December 2007}}</ref><ref
name=lewis>{{cite web | url=http://www.consumeraffairs.com/news04/2006/12/gift_card_giveaways.html | archive-url=https://web.archive.org/web/20080916232357/http://www.consumeraffairs.com/news04/2006/12/gift_card_giveaways.html | url-status=dead | archive-date=16 September 2008 | author=Lewis, Truman | title=Gift Cards an $8 Billion Gift to Retailers|website=consumeraffairs.com | date=20 December 2006|access-date= 16 June 2008}}</ref> The recipient of a gift card can use it at their discretion within the restrictions set by the issue, for example as to validity period and businesses that accept a particular card.

Gift card sales are not limited to banks or retailers; such other companies as [[airlines]], [[cruise ship]]s, [[hotel]]s, [[Barber|barber shop]]s, [[train]] companies, [[theme park]]s, [[restaurant]]s and other type of companies may offer gift cards as well.

==History==
{{more citations needed|date=June 2012}}
In 1932 the Book Tokens scheme was established in UK by publisher Harry Raymond.<ref>{{cite web|url=https://www.theguardian.com/lifeandstyle/2007/nov/17/weekend.lucymangan|title=An appreciation of a token|first=Lucy|last=Mangan|date=17 November 2007|website=the Guardian}}</ref> The original format of the tokens was as "lick-and-stick" stamp-like vouchers, which were glued into gift cards and had to be removed by the bookseller redeeming the token. In the 1990s, this design was changed to a "currency-style" voucher, available in a number of different denominations.<ref>{{cite web|url=http://www.nationalbooktokens.com/about-us/gallery/Brief-History.aspx|title=National Book Tokens|website=National Book Tokens}}</ref>

In 1994 [[Neiman Marcus]] introduced the gift card system in US using a payments infrastructure in late 1994,<ref>{{cite web|last=Buchanan|first=Matt|title=The Vile History of Gift Cards and How They Came to Destroy Christmas|url=https://gizmodo.com/5434783/the-vile-history-of-gift-cards-and-how-they-came-to-destroy-christmas|website=Gizmodo|date=27 December 2009 |access-date=7 June 2012|archive-date=25 June 2018|archive-url=https://web.archive.org/web/20180625132420/https://gizmodo.com/5434783/the-vile-history-of-gift-cards-and-how-they-came-to-destroy-christmas|url-status=live}}</ref> though [[Blockbuster LLC|Blockbuster Entertainment]] was the first company to do so on a wide scale,<ref>{{cite web|url=https://www.thefreelibrary.com/CES%2fNaBANCO+introduces+stored+value+card+technology%3b+Blockbuster...-a017787941|title=CES/NaBANCO introduces stored value card technology; Blockbuster Video is first merchant partner|website=Business Wire|archive-url=https://web.archive.org/web/20130619150012/https://www.thefreelibrary.com/CES%2fNaBANCO+introduces+stored+value+card+technology%3b+Blockbuster...-a017787941|archive-date=19 June 2013|url-status=dead|access-date=14 January 2018}}</ref> test-marketing them in 1995 and launching them around the country the next year. In the beginning, the Blockbuster gift card replaced gift certificates that were being counterfeited with recently introduced color copiers and color printers. Blockbuster's first gift card transactions were processed by what was then Nabanco of [[Sunrise, Florida]]. Nabanco was the developer of the first third-party platform for the processing of gift cards using existing payment infrastructure.

Neiman Marcus and Blockbuster were later followed by the [[Mobil]] gas card, which initially offered prepaid phone value provided by [[MCI Inc.|MCI]]. [[Kmart (United States)|Kmart]] was next with the introduction of the Kmart Cash Card, which in the early generations provided prepaid phone time with [[AT&T]]. Later Kmart and Mobil dropped this feature, as it was not profitable for them. The Kmart Cash Card was the first replacement for cash returns when a shopper did not have a receipt for a gift. This practice of giving a cash card in place of cash for non-receipted returns is commonplace today with most merchants. From these early introductions, other retailers began to adapt a giftcard program to replace their gift certificate programs.

==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.

==Gift card collecting==
Gift cards can have many different designs, including for, holidays, special occasions, sports teams, cartoons, and more. Some hardcore collectors collect different variations of each card, and or prefer where the pin number is not scratched off. Even more desirable are brand new unused gift cards even ones still attached to the retail backers. Most gift cards are plastic, some variances include clear plastic, shaped cards, and paperboard cards. Recently most [[Starbucks]] and [[Chipotle Mexican Grill|Chipotle]] gift cards are now paperboard instead of plastic. A partial list of popular retailers with collectors who have released gift cards worldwide with many different designs and or variations include:<ref>{{Cite web|last=Tobias|first=Todd|date=2019-12-19|title=Great Holiday Gifts for Card Collectors|url=https://blog.psacard.com/2019/12/19/great-holiday-gifts-for-card-collectors/|access-date=2021-04-15|website=PSA Blog|language=en-US|archive-date=15 April 2021|archive-url=https://web.archive.org/web/20210415175036/https://blog.psacard.com/2019/12/19/great-holiday-gifts-for-card-collectors/|url-status=live}}</ref><ref>{{Cite web|date=2013-12-05|title=Holiday Gift Guide for sports collectors|url=https://www.beckett.com/news/holiday-gift-guide-for-sports-collectors/|access-date=2021-04-15|website=Beckett News|language=en-US|archive-date=25 October 2021|archive-url=https://web.archive.org/web/20211025160452/https://www.beckett.com/news/holiday-gift-guide-for-sports-collectors/|url-status=live}}</ref>
{{div col|colwidth=12em}}
* [[Aldi]]
* [[Applebee's]]
* [[Barnes & Noble]]
* [[Best Buy]]
* [[Burger King]]
* [[Chick-fil-A]]
* [[Chili's]]
* [[Chipotle Mexican Grill|Chipotle]]
* [[CVS Pharmacy|CVS]]
* [[Dollar Tree]]
* [[Dunkin' Donuts]]
* [[Firehouse Subs]]
* [[GameStop]]
* [[Home Depot]]
* [[IHOP]]
* [[In-N-Out Burger]]
* [[Jack in the Box]]
* [[JCPenney]]
* [[Kmart]]
* [[Krispy Kreme]]
* [[McDonald's]]
* [[Olive Garden]]
* [[Panera Bread]]
* [[Perkins Restaurant & Bakery|Perkins]]
* [[Qdoba]]
* [[Red Lobster]]
* [[Red Robin]]
* [[Schlotzsky's]]
* [[Sears]]
* [[Sonic Drive-In|Sonic]]
* [[Starbucks]]
* [[Steak 'n Shake]]
* [[Subway (restaurant)|Subway]]
* [[Target Corporation|Target]]
* [[Tim Hortons]]
* [[Toys "R" Us]]
* [[Walmart]]
* [[Wendy's]]
{{div col end}}

According to the ''[[Guinness Book of World Records]]'', the largest gift card collection in the world, as of 2021, belonged to Canadian-American brothers Aaron and David Miller of [[Scarsdale, New York]]. By 2013, the brothers had amassed an estimated 3,125 different cards.<ref>https://www.guinnessworldrecords.com/world-records/largest-collection-of-gift-cards#:~:text=The%20largest%20collection%20of%20gift,to%20make%20shopping%20more%20enjoyable {{Webarchive|url=https://web.archive.org/web/20211023235257/https://www.guinnessworldrecords.com/world-records/largest-collection-of-gift-cards#:~:text=The%20largest%20collection%20of%20gift,to%20make%20shopping%20more%20enjoyable |date=23 October 2021 }}.</ref>

In addition, some online collecting websites have pages dedicated to gift card listings for collectors.

==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>

==Redemption rate==
{{main | Breakage (accounting)}}
Not all gift cards are redeemed. The card may be lost, there may be time decay expiration and fees or complex rules of redemption, or the recipient may not be interested in the store that accepts the card or be under the false assumption that not using it will save money for the giver. It has been estimated that perhaps 10% of cards are not redeemed, amounting to a gain for retailers of about $8 billion in the United States in 2006.<ref name=lewis/>

In 2012,{{needs update|date=April 2025}} over $100 billion in gift cards were expected to be purchased in the United States, where over 20% of those gift cards expected to go unredeemed or unused. This has amassed a large opportunity in the secondary market, similar to the secondary ticket market in the early 2000s. Some companies have created a business in the secondary gift card market that allows consumers to sell their unused gift cards or to buy discounted gift cards for their favorite brands. This has helped their users recoup their share of some $55 million per day that goes unredeemed in the United States every year.{{citation needed|date=May 2019}}

==Regulations==

=== Canada ===
All Canadian provinces have passed laws to ban expiry dates and fees collected on gift cards.<ref>{{cite news|url=https://financialpost.com/entrepreneur/gift-cards-come-with-regulations|title=Most provinces now disallow expiry dates|last=Entrepreneur|date=27 February 2012|newspaper=Financialpost|access-date=29 March 2019|archive-date=12 December 2019|archive-url=https://web.archive.org/web/20191212044951/https://financialpost.com/entrepreneur/gift-cards-come-with-regulations|url-status=live}}</ref> However, provincial gift card laws do not apply to sectors that are regulated under federal laws. For example, gift cards that resemble credit cards ( i.e. with American Express, MasterCard, or Visa branding) and phone cards are regulated by the federal government. Under the federal ''Prepaid Payment Products Regulations'', effective 1 May 2014, federally regulated gift cards may only charge maintenance fees under certain conditions and may not set an expiry date for funds on those cards.<ref>{{cite web|url=https://www.canada.ca/en/financial-consumer-agency.html?itemid=249|title=Financial Consumer Agency of Canada|date=26 July 2015|website=Canada.ca|access-date=29 March 2019|archive-date=29 March 2019|archive-url=https://web.archive.org/web/20190329222632/https://www.canada.ca/en/financial-consumer-agency.html?itemid=249|url-status=live}}</ref>

=== United States ===
In the past, there were no uniform standards concerning gift cards. This was set to change,{{needs update|date=April 2025}} as an addendum to the [[Credit CARD Act of 2009]] directs the federal government to create consumer-friendly standards pertaining to gift cards.<ref>{{cite web|url=https://www.govtrack.us/congress/bills/111/hr627/text|title=Text of H.R. 627 (111th): Credit Card Accountability Responsibility and Disclosure Act of 2009 (Passed Congress version)|website=Gov Track|archive-url=https://web.archive.org/web/20120404032822/https://www.govtrack.us/congress/bills/111/hr627/text|archive-date=4 April 2012}}</ref> Most notably, the new regulations prohibit retailers from setting expiration dates unless they are at least five years after the card's date of issue or the date on which funds were last added to the card. In addition, retailers can no longer assess dormancy, inactivity, or service fees unless the card has been inactive for at least 12 months; if fees are added after that period, the details of such fees must be clearly disclosed on the card. Additionally, retailers are unable to levy more than one fee per month. The new provisions took effect on 22 August 2010.<ref>{{cite news|url=http://wkow.com/Global/story.asp?S=12188430|archive-url=https://web.archive.org/web/20110718073219/http://wkow.com/Global/story.asp?S=12188430|url-status=dead|archive-date=2011-07-18|title=Gift Cards|date=August 2010|work=WKOW}}</ref>{{needs update|date=April 2025}}

Open loop cards are governed by rules of the [[Comptroller of the Currency]]; however, oversight has been criticized.<ref name=consumer/> Closed loop gift cards are subject to rules set by different state regulations, and issuing authorities vary widely in the rules they set for the consumer.<ref name=consumer/> Moreover, rules can be changed by the issuer without notifying the consumer.<ref name=consumerreports/><ref name=lewis/>

==See also==
*[[Rebate card]]
*[[Token money]]

==References==
{{reflist|35em}}

{{DEFAULTSORT:Gift Card}}
[[Category:Exonumia]]
[[Category:Debit cards]]
[[Category:Giving]]
[[Category:Payment systems]]
[[Category:Personal finance]]
[[Category:Retail financial services]]
[[Category:1994 introductions]]
[[Category:1996 introductions]]
[[Category:American inventions]]