A gift card is a prepaid card or code that holds a monetary value which the holder can redeem for goods or services at a business. It can be physical, like a plastic card, or digital, delivered by email, text or a mobile wallet.
Each gift card carries a unique number or barcode linked to a balance held in the POS or a gift card platform. At purchase, the card is activated with a value. At redemption, the cashier scans or enters the code, the system checks the balance and deducts the sale amount, and any remaining value stays on the card. Cards can often be redeemed across all stores and sometimes online.
Retailers and venues sell gift cards for gifting seasons, promotions and as a way to handle refunds or credits. They bring in cash upfront and often attract new customers, and many customers spend more than the card value.
Things to consider include whether the POS supports multi-store and online redemption, how outstanding balances are tracked in your accounts, and the consumer rules that apply. In Australia, gift cards are subject to laws including minimum expiry periods, so businesses should check current requirements from their state or territory regulator and the ACCC. Fraud controls, such as secure activation, are also important.
Gift cards matter because they are both a revenue tool and a liability on the books. RetailCare can help businesses use gift card functions within their POS and keep redemption consistent across locations.