what is gift card

A gift card, also known as a gift certificate, gift voucher, or gift token, is a prepaid stored-value money card that can be used as an alternative to cash for purchases within a specific retailer or bank. It is essentially a prepaid debit card that contains a specific amount of money available for use for a variety of purchases. Gift cards can be open-loop or closed-loop, with open-loop cards being usable anywhere the brand is accepted, while closed-loop cards are limited to specific merchants or retailers. They are generally redeemable only for purchases at the relevant retail premises and cannot be cashed out, and in some situations may be subject to an expiry date or fees. Gift cards can be used to control spending, make purchases, and can be an appropriate gift for holidays or special occasions. They can also be used to increase cash flow, impulse purchases, and higher margin sales for businesses. Overall, gift cards are prepaid cards that function like ATM cards and can be used to pay for products or services at stores that support the card, making them a convenient and versatile form of payment.