Did you know the first gift card was introduced in the early 1990s by American Express? The idea spread fast. Soon many brands, stores, restaurants, tech companies, created their own gift cards. But why did gift cards become so popular? What makes people buy and use them? And how do they actually work?
In this blog, we will explain gift cards in a simple way. You will learn what a gift card is, how it works, and the many ways people use it in Nigeria today. Let’s begin.
What Is a Gift Card?
Let's start with the basics! A gift card is a prepaid card that already has a specific amount of money loaded on it. You can think of it as a digital or physical wallet that you can use at a particular store or brand. Instead of giving cash or guessing someone’s favorite item, people give gift cards so the receiver can choose what they want. Gift cards come in two major types:
Closed-loop gift cards which are usable only at one brand (like Apple, Amazon, Sephora, Nike).
Open-loop gift cards which are usable anywhere the card network is accepted (like Visa, Mastercard, Amex).
This simple idea is why gift cards became so popular. They remove the stress of choosing the “perfect gift” while still giving something valuable.
How Does a Gift Card Work?
1. Gift cards work in a very simple way. Each card comes with a set amount of money already loaded on it. This could be $10, $25, $50, $100 or any other value the brand offers. The amount stored inside the card is called the balance.
2. Every gift card has its own unique code. When you want to use it, you enter this code at checkout if you’re shopping online, or you show the card in-store. The system reads the code and confirms how much value is left on it.
3. When you buy something with the card, the cost of your purchase is subtracted from the balance. This continues until the amount becomes zero. Once there is no money left, the card can’t be used again.
4. Gift cards can be physical or digital. Physical cards usually come with a scratch panel that hides the code. Digital cards are sent to your email with the code visible, and they can be used instantly.
5. You don’t need a bank account or personal documents to use a gift card. The code itself is all you need. This makes gift cards easy to redeem and very convenient for online and in-store shopping.
What are Gift Cards Used for?
Shopping with Gift Cards
The main reason for the popularity of gift cards is that they can be used in so many different ways. The most common use is shopping. If you have a gift card for a specific store or brand, you can use it to buy anything they sell, either online or in-store. It works like prepaid money, so you don’t need cash or a debit card at checkout.
Gifting to Others
People also use gift cards as presents. Instead of guessing what someone might like, giving a gift card lets them choose exactly what they want. This is why brands like Amazon, Apple, Nike, and Steam are so popular as gifts, they give the receiver complete freedom.
Subscriptions and Digital Services
Gift cards are also used for subscriptions and digital services. For example, a Google Play or Apple gift card can be used to buy apps, make in-app purchases, pay for music, movies, or even cloud storage. Steam gift cards and PlayStation cards can be used to buy games, skins, or other digital items, making them very popular among gamers.
Budgeting and Spending Control
Some people use gift cards to manage their spending. Because a gift card has a fixed amount, it helps you stay within a budget. Parents also use gift cards to safely control how much their children can spend on apps or games.
Discounts and Promotions
In many countries, gift cards are used to unlock discounts or special offers. Some brands give promotions when you pay with a gift card instead of a bank card.
Trading or Selling Gift Cards
Another growing use is trading gift cards. If someone receives a gift card they don’t need, they can sell it for cash on trusted platforms. If you have wondered what is gift card used for in Nigeria, you would be surprised to know that selling them has become very common and is one of the biggest reasons gift cards stay in high demand.
How Can You Redeem Gift Cards?
If you have never used a gift card and are confused how to redeem its value, here's a few tips we have got for you.
For physical gift cards, scratch off or uncover the unique code and enter it at the store checkout or on the brand’s website. The value will be applied to your purchase, and any remaining balance can often be used later.
Digital gift cards are delivered via email or app. Copy the code and enter it in the payment or redemption section of the brand’s website or app. Digital cards allow instant redemption and are ideal for online shopping.
Some gift cards are tied to specific platforms, such as gaming or subscription services. Sign in to your account, locate the “Redeem Gift Card” or “Add Balance” option, and enter the code carefully. Always confirm your updated balance before making a purchase.
Tips for smooth redemption:
- Always check expiration dates of your gift cards, keep your code secure, and contact the issuer’s customer support if there are any issues.
- Many cards also allow partial spending, so you can use them in multiple transactions.
- Another important thing to remember is that the refund process for gift cards may vary depending on the retailer; some allow returning items purchased with a gift card and crediting the value back to the card.
Why Do Gift Cards Make a Great Present for Someone?
Freedom of Choice: Gift cards give recipients complete control over what they want to buy. Instead of guessing someone’s taste or size, the recipient can select exactly what appeals to them, making the gift truly personalized.
Flexible Usage: Most gift cards can be redeemed both online and in physical stores. Some even allow purchases for digital services, subscriptions, or in-app credits, giving the recipient multiple options to enjoy their gift.
Time-Saving: Buying and sending a gift card is quick and efficient. Digital cards can be delivered instantly via email, saving time on shopping trips, gift wrapping, or shipping, especially for last-minute occasions.
Convenient for Any Occasion: Gift cards are suitable for birthdays, anniversaries, holidays, corporate incentives, or even small gestures of appreciation. They are a versatile solution for almost any gifting scenario.
Thoughtful and Considerate: A gift card shows you remembered someone and cares about their preferences. It strikes a balance between thoughtfulness and practicality, letting the recipient choose something meaningful without the guesswork.
FAQs
1. What is a gift card used for?
A gift card is used as a prepaid store credit that allows the holder to purchase goods or services up to the card’s value. It can often be used both online and in-store, depending on the brand.
2. Can gift cards be used internationally?
Some gift cards are limited to specific countries or regions, while others, especially digital cards from global brands, can be redeemed internationally. Always check the card’s terms and conditions.
3. Can gift cards be sold for cash?
Yes, unused gift cards can be sold on reliable platforms like Tbay that buy gift cards for cash. This allows you to convert unwanted or partially used cards into instant money.
4. Are digital gift cards safe to use?
Absolutely. Digital gift cards are secure as long as you purchase them from verified vendors. Avoid sharing the code publicly to prevent unauthorized use.
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