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Gift cards are very popular during the holiday season. They are convenient, flexible and can be purchased in denominations to fit just about any budget. But sometimes problems crop up. Suppose you are gift card buyer who is looking to buy cards at a discount or you are a recipient who either can’t use the gift card or would prefer to have cash. At the end of 2015, gift card spillage (the value of unused gift cards) stood at $973 million. One response to all of these issues is the rise of the gift card exchange.
A gift card exchange is an online marketplace that brings together buyers and sellers of gift cards. Sellers can set up accounts to handle multiple card sales. Buyers can browse among the available gift cards and select the ones they want. Best of all, the average discounts for buyers range from 3 to more than 6 percent among the largest gift card exchanges.
Conversely, sellers can receive up to 95 percent of card value when selling on an exchange. It’s a win-win proposition, but it pays to look for the best exchanges and the best deals.
In most cases, sellers will sell cards directly to the exchange, and buyers will buy cards directly from the exchange. At raise.com and some P2P marketplaces, the exchange is strictly an intermediary where buyers will buy directly from sellers.
Here are our tips to getting the most value from a gift card exchange.
Compare 3 of the Best Gift Card Exchange Sites for Buyers
|Shipping Costs||Free Shipping||Free Shipping||Free Shipping|
|Money-Back Guarantee||1 Year||1 Year||45 Days|
|Delivery Speed||3-7 Business Days||3-14 Business Days||Up to 7 Days|
Best Gift Card Exchanges
If you’re like most people, you amass a collection of gift cards you will never use. Instead of having to live with, “it’s the thought that counts,” you can turn those gift cards into cash or trade them for ones you can actually take advantage of. Thanks to the Internet, a whole new marketplace has emerged that treats gift cards like a currency. Gift card exchanges operate like a broker to create a market for buyers and sellers of gift cards. You can sell your card on the exchange for a percentage of its value, receiving cash or some other form of compensation. You can also shop for gift cards and purchase them at a discount from the card’s value. Like most emerging online marketplaces, the gift card exchange market attracts its share of shady dealers, so you want to make sure you deal with well-vetted and reputable sites. Here are three of the best.
|Cash Back for Sales||Up to 92%|
|Buy Discount||Up to 35%|
Cardpool operates more like a dealer on both sides of the transaction, buying and selling gift cards on behalf of its members. That way you deal only with Cardpool and avoid the hassle of dealing with an individual. It accepts both physical cards and e-cards from most major retailers as well as many smaller merchants, but it doesn’t accept cards with fees or expiration dates.
If you are a buyer, you can go to the Cardpool website to browse through categories and merchants for the card you want (Cardpool does not have a search feature). If you can’t find the card you want, you can create a “wish list” and receive a notification when your card is available. Physical cards are mailed at no charge, taking a few days for delivery. If you purchase an e-card, you will be sent an email containing its code. Your purchase is guaranteed for 100 days after the sale.
If you are a seller, you will receive a postage-paid shipping label to mail your physical card. Once Cardpool verifies the card’s value, it will issue a check which can take three to five business days to receive. Or, you can opt to receive an electronic voucher from Amazon.com. With this option your exchange is worth a few extra points. If you see another gift card you want, you apply the value of your sold card to the purchase of another one.
The amount you will actually receive depends on the card’s popularity. A Walmart gift card will be worth much more than a gift card from The Foot Locker. Cards from most smaller retailers might fetch 70% of the card’s value, but 70% of something is better than 100% of nothing if you are never going to use the card.
Cardpool has been around since 2009, boasting that is has saved its customers more than $32 million. It is A+ rated by the Better Business Bureau and has been featured on all the major networks as well as the New York Times and the Wall Street Journal.
Raise is cool because it allows you to buy and sell cards right from your iPhone. What’s great about the Raise app is you can instantly find a gift card you can use while shopping at a store. For example, if you see something you want while shopping at Lowes that costs $50, you can open the Raise app and find a $50 Lowes gift card for $42. The barcode you receive in an email is scanned at checkout.
Raise has offered gift cards from more than 3,000 brands since 2013 and has 750 to 800 brands available at any given time. The name “Raise” refers to the raise in purchasing power it offers its more than one million users. With its on-demand app, users can certainly stretch their shopping dollars.
To buy or sell a gift card with Raise, you need to set up an account, provide your mobile number and add a payment card (Raise allows you to take a picture of your card and upload it). You can then browse through the hundreds of gift cards in inventory. Browsing categories include “top brands”, “nearby stores” and “trending”. You can then sort and compare cards by value and discount. When you decide on a card, you send it to checkout and it can then be retrieved using the Raise app.
As a seller, you post your gift card for sale on the site and set the price. The app keeps you informed of cards you have listed for sale, notifying you instantly of a sale and making funds available for deposit into your bank account. When one of your cards is sold, Raise takes a 15% commission fee.
Raise boasts more than 2 million users who have saved over $125 million dollars. Raise backs all of its transactions with a one-year money back guarantee which covers any card that doesn’t work or has an inaccurate balance.
|Cash Back for Sales||Up to 92%|
Founded in 2009, CardCash claims to be the largest gift card exchange. Its site is easy to navigate, allowing buyers to browse among the thousands of merchants it has in inventory, while offering sellers an easy way to post their gift cards. If all you want to do is exchange your gift card for another, it facilitates the swap. If something goes wrong – i.e. your card has an incorrect value left on it – CardCash guarantees your purchase for 45 days.
Gift card buyers can have a field day on the CardCash site, browsing through thousands of gift cards and getting instant satisfaction with an email delivery of their gift card code. Physical gift cards are mailed, requiring three to five days for delivery and a $1 shipping charge for orders less than $50. If you don’t find the gift card you want, you can sign up for an email alert, notifying you when the card is available.
Gift card sellers can post their gift cards on the site and set a price based on what other, similarly valued cards are selling for. CardCash will accept gift cards with a balance as low as $1, but it won’t accept gift cards with an expiration date. Once your gift card sells, CardCash will mail you a check or pay you through PayPal. You can receive a bigger cut if you accept payment as an Amazon or eBay gift card.
CardCash makes it easy to exchange one gift card for another. The gift card you want to purchase has to be worth as much or more than the gift card you are exchanging. If you are exchanging a physical gift card, you won’t receive your new gift card until the value of your gift card has been verified. While CardCash makes it quick and easy to exchange cards, it will charge you a fee of between 3% and 30% for the service.
One word of warning: CardCash has received a C+ rating from the Better Business Bureau due to a rash of complaints that card balances disappeared 45 days after purchase. CardCash now advises their customers through a written notice to make sure they use their gift cards within 45 days of purchase.
Selling on a Gift Card Exchange
- The cards you list are valid, owned and controlled solely by you, redeemable for the stated balance and exclusive to the card exchange
- You don’t attempt to redeem the card after selling it
- You will retain any plastic gift card that you convert to a digital gift card for a set time period
- The card is free of any liens or other restrictions
- You will only list gift cards that can be used or sold in the U.S.
- You’ll observe limits on the value of cards you list
- You must be a U.S. resident, and register a working credit or debit card with the exchange
- You will comply with all other requirements to complete the sale, including shipping/delivery procedures
Next, enter information about the gift card, such as its serial number, a PIN (if available), the current balance, and the selling price, which is set either by you (on a P2P exchange) or by the exchange itself. The exchange will tell you how much of your price you’ll receive, with the remainder going to the exchange as commission and listing fee. Expect to pay a total fee of 5 to 15 percent, although the amounts vary by exchange. On P2P sites, you need to set a competitive price for your gift card. It helps to peruse similar cards for sale to come up with a competitive price. The exchange will verify the gift card details and remaining balance.
Seller Pros & Cons
There are a number of factors that determine whether you are using the best gift card exchange on which to do your selling.
- Payment Amount: The site has the highest payments (lowest commissions and listing fees). You can tell this by looking at aggregation sites that list competing gift card exchanges.
- E-cards: The site lets you sell e-gift cards at the same or lower commission.
- Merchandise Credits: The site accepts merchandise credits the same as traditional gift cards.
- Shipping: The site issues you a standard label, and perhaps postage, to ship your card to the buyer or to the site.
- Payment Method: Some sites pay you only by check. Better sites also pay via direct deposit or PayPal. Some sites pay you extra if you accept payment in the form of an Amazon gift card.
- Minimum Value: Some sites only accept cards with a stated minimum value or higher.
- Timeliness: If you sell at a P2P site, you have to wait for a buyer before you can collect your money. When you sell directly to the exchange, you get paid right away.
- Pickiness: Some sites may limit the types of gift cards you can sell, including prepaid cards from American Express, Discover, MasterCard and Visa.
- E-cards: The site might charge you more to handle e-cards
- Trustworthiness: The site might be dishonest and fails to pay you the agreed amount, or anything at all. Trustworthy sites are typically large and have been around for more than a year.
Buying on a Gift Card Exchange
It’s somewhat easier to buy on an exchange that it is to sell. You simply peruse the offerings, add the ones you want to your shopping cart, and then check out. You usually don’t need to be a member to check out, but if you plan to return for more cards, it saves time if you become a member. You pay with a credit card, a promotional code and/or a gift card from the exchange itself. Once you enter your personal information and pay up, physical cards will be shipped to you (usually for free) and will arrive within three to seven days, or will be electronically shipped to your email address instantly.
- Large Variety: Some sites have 200 Walmart gift cards for sale but no Starbucks cards. You might prefer a site that lists a wider variety of gift cards in many different denominations.
- Good Discounts: The better deals are available at sites that offer discounts of 5 percent or more. Some sites offer discount specials as high as 89 percent.
- Bulk Purchases: You might be able to get larger discounts when you make bulk purchases of gift cards. Check details with each exchange.
- Only One Form of Card: Some exchanges feature only physical cards, others only e-gift cards. If you need both types, you might prefer a site that offers both. Some sites offer printable e-cards, which might be useful for you.
- Money Back Guarantee: Some sites do not offer money-back guarantees to gift-card buyers unless the card arrives with less value than promised. Some sites offer refunds only on physical gift cards.
- Scam Sites: Beware, some gift card exchanges are fly-by-night operations that come and go quickly. Always do business with sites that have been around for a year or longer.
Author: Jeff Gitlen