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Gift Cards: Everything You Need to Know

Gift cards have become an increasingly popular way to treat someone while taking the guesswork out of gift giving. They can be used just like cash at a specific retailer or across many different merchants.


A prepaid gift card can be redeemed for anything from luxury items to household necessities. Recipients can choose where to spend it, what to spend it on and when it’s convenient for them. There are some things to keep in mind to maximize their dollar value to the fullest – even in the case of loss or damage.

July 24, 2020 in Benefits

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Types of gift cards 

Gift cards may come in either physical or electronic form. A prepaid dollar amount is loaded onto the card, which can then be used toward one or more transactions. Gift cards are used not only to pay for physical items in bricks-and-mortar stores, but also while online shopping for experiences such as travel and events.


Generally speaking, there are two types of gift cards:


  1. Open-loop gift cards, which can be redeemed across many different retailers. One example of this is the American Express® Prepaid Card, which may be used anywhere in Canada that accepts American Express
  2. Closed loop gift cards, which can be only redeemed at the specific stores where they are issued. While American Express doesn’t issue closed-loop gift cards, you can redeem your Membership Rewards® points for gift cards from a variety of retailers.

Benefits of gift cards

The benefits of gift cards can include convenience for both the giver and the recipient and the ability to manage them online.

Lets the recipient choose

Giving someone a gift card puts them in the driver’s seat. They’re more likely to treat themselves to something special than if you just gave them cash.

Demonstrates more effort than giving cash 

Choosing a specific retailer where the gift card can be redeemed can show you were paying attention to the recipient’s preferences. It’s a much more personalized way to grant someone’s wish than by simply giving them money.

Get the most from using gift cards 

Consider these simple tips on redeeming gift cards to get the most value from your gift card.

Use gift cards for more than just shopping

Giving, receiving or redeeming a gift card doesn’t always mean having to make a trip to the mall or shopping for a physical item. For example, some gift cards may also be redeemed to make a charitable donation.

Get more than the fixed value

Some retailers may offer you incentives to shop online such as extra discounts or gifts with purchase, in which case that $50 gift card can get you more than its fixed value. If you can time your purchase with in-store promotions, seasonal sales or loyalty program rewards, you can stack your gift card with those deals to save even more.

Don’t buy unnecessary items

If your gift card doesn’t have a set expiration date, don’t feel pressured to use it right away or all at once. Take your time and choose your purchases wisely.

Keep track of your gift cards

Some mobile wallets allow you to keep track of your gift cards’ balances electronically. Keep in mind that not all retailers may be able to scan or accept gift cards from your phone.

Remember your balance before making a purchase

If you know your balance before heading to the store or clicking the purchase button, you won’t be caught off guard by the total. It will make it easier for you to stick to your budget rather than be tempted to overspend.

Beware of scams

Consider the risk of buying a gift card off a stranger on a bulletin board compared to purchasing it directly from the retailer. That discount they may be offering won’t be worth it if the card turns out to be unusable. Protect yourself from scams by checking that the card and its packaging haven’t been tampered with and by verifying its value with the retailer.

Even if you do buy a gift card from the retailer, some scammers could copy the PIN numbers off the back while it’s on the store rack and redeem them online later. Protect yourself by choosing cards with a hidden PIN and keeping receipts that show how much you paid.

How to buy a gift card

Most gift cards can be purchased online. To buy a gift card, you would visit the retailer’s website, select the desired denomination, and provide either your own email address or the email of the intended recipient to where the card will be sent electronically.


You may also redeem points for a gift card using your available Membership Rewards® points once you have accumulated enough points.

How to check gift card balances

To check transaction history and your gift card balance, visit the website of the issuing merchant, usually listed on the back of the card. You’ll need to log into your account with information like the gift card number and the security code on the front or back.

Explore Our Cards

American Express offers a range of Cards with different rewards and benefits tailored to your lifestyle and interests.