What Is a Gift Card and Why Is?

A gift card is a prepaid card that can be used to purchase goods or services from a specific store, group of stores, or general-purpose platforms. Gift cards are offered in both physical and digital formats and have become a popular way to give flexible and thoughtful gifts.

Types of Gift Cards

Gift cards typically fall into two main types:

• Closed-Loop Gift Cards – These cards can only be used at a specific brand or store. For example, an Amazon or Starbucks gift card.
• Open-Loop Gift Cards – These cards are issued by major payment networks like Visa or Mastercard. They can be used at any location that accepts those networks.

Why Are Gift Cards So Popular?

There are several reasons why gift cards have become a go-to option for gifting:

• Flexible Spending – Recipients can choose exactly what they want, when they want it. This makes the gift more personal and useful.
• Quick and Easy to Send – Digital gift cards can be sent instantly via email or text. They are perfect for last-minute gifts.
• Widely Accepted – Many gift cards, especially open-loop ones, are accepted in stores, apps, and online shops.
• Budget-Friendly – You can set your own amount. There are no surprises or overspending.
• No Guesswork – Instead of guessing sizes, styles, or preferences, you let the recipient choose something they’ll love.