On paper, gift cards make perfect sense. They offer the opportunity for you to give a gift to someone who may be difficult to buy for and gives them the freedom, and money, to buy what they want.
But, like most things in life, they aren’t always so good in practice.
Annoying restrictions placed on gift cards by card providers or retailers take the fun out of them and can get in the way of their usefulness.
Whether you’re shopping for Christmas, birthday or something else, should you buy a gift card?
Should you buy gift cards?
Gift cards can be useful if you must send a gift to someone you can’t deliver to or for someone notoriously difficult to buy for.
However, in my opinion, they don’t make good gifts.
For one, they remove you, the giver, from the gift of giving. Imagine you’re presenting a wrapped gift to the recipient. You get to see their eyes and their gratitude.
It’s an event. Something that creates a memory and created a feedback loop between the gift giver and the giftee. Assuming everything goes well of course!
You don’t get any of that with a gift card. You’re often not even there when the recipient opens the card. There’s no event. There’s no feedback loop.
There is just a little extra money for them to spend in a store.
If you can’t visit someone to give them the gift or can’t be there when they open it, you won’t get that feedback anyway, so it isn’t all bad.
The problems with gift cards
The main issues I have with gift cards is how they are managed.
Expiry dates – My first problem is that most gift cards have expiry dates. That’s something they don’t often tell you, but most cards need to be used within a certain date. If you don’t use the card, the card issuer keeps your money. How is that fair?
The expiry date is purely arbitrary. It isn’t necessary. A card doesn’t degrade or go off. There’s no concrete reason for expiration except to make extra profit.
Limited in where you can spend it – Some gift cards are for single stores while others cover retail groups with a number of stores. Either way, you’re restricted where you can spend them. If you’re after a specific item and it’s on sale somewhere else, you’re stuck paying more for it because of the card.
Shopping around and bargain hunting is all part of the fun. Fun that gift cards can take away.
Refunds go back to the card – If you buy something using a gift card and need to return it, the refund goes back on the card. Some issuers will give you a new card with a new expiry date while others will credit your original card.
No Section 75 protection – If you buy something using a credit card, you’ll get Section 75 protection. That’s where you can claim from the credit card company if something goes wrong and the original retailer cannot service a refund. This is primarily for purchases over £100, but it adds an extra layer of protection you don’t get with a gift card.
Wasted if the provider goes into administration – While it may seem unlikely, the number of retailers and finance companies going out of business is at an all-time high. If the card issuer or the retailer the card is for goes into administration, you’re out of luck.
Gift cards aren’t all bad though
Despite my personal low opinion of gift cards, they can work in certain situations.
If you plan to spend it right away – If you receive a card for a retailer you use often and plan to use it immediately, it can be a good way to gift.
You get a retail group gift card – Cards that cover a retail group, One4all or Highstreetvouchers.com cards enable you to spend your card in a variety of popular stores. While they still have downsides, at least you get more choice.
Viable alternatives to gift cards
If you cannot gift in person and don’t want to use a gift card, what are your options?
Cash – Yes, people still use cash. It’s as impersonal as a gift card but offers the freedom to spend it wherever you like with no restrictions.
Bank transfer – You can transfer money from your bank to the recipient quickly and safely. Yes, it’s impersonal, but no more or less than sending a gift card. Again, it offers more freedom with fewer restrictions.
Amazon voucher – I don’t really condone supporting a monolith like Amazon but we all use it. Digital Amazon vouchers are the equivalent of a gift card and can be used on almost everything Amazon sells.
Using gift cards
So, after all that, do gift cards make good gifts?
Personally, I think not. The retailers and companies have loaded the dice in their own favour too much to make them worthwhile.
I would suggest any alternative would be a better option and have suggest a couple here.
If you have any different ideas or other alternatives to gift cards, let me know below!
