Definition of 'Gift Card'
There are two main types of gift cards: closed-loop and open-loop. Closed-loop gift cards can only be used at the merchant that issued them. Open-loop gift cards can be used at any merchant that accepts the card brand.
Gift cards can be purchased in a variety of denominations, from as little as $5 to as much as $1,000. They can be purchased online, in stores, or by phone.
When you purchase a gift card, you will typically pay the full amount of the card plus a processing fee. The processing fee is typically between 2% and 5% of the card value.
Once you have purchased a gift card, you can redeem it by presenting it to the cashier at the merchant where you want to use it. The cashier will swipe the card and deduct the card value from your purchase.
Gift cards can be a convenient way to give a gift. They are also a safe way to give a gift, as the recipient cannot use the card to purchase anything they do not want.
However, gift cards can also be a waste of money. If the recipient does not use the card, the value of the card will be lost. Additionally, gift cards can be difficult to track if they are lost or stolen.
Overall, gift cards can be a good way to give a gift, but it is important to be aware of the potential risks before purchasing a gift card.
Here are some additional tips for using gift cards:
* Choose a gift card that the recipient is likely to use.
* Purchase the gift card from a reputable retailer.
* Keep the gift card receipt in a safe place.
* If the gift card is lost or stolen, contact the merchant to cancel the card.
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