A gift card (also known as a gift voucher) is a popular method of gifting, which allows the intended recipient to purchase the product or a service of their choice using the cash value on the card. A gift card allows users to receive products or services from malls, shopping centers, showrooms, etc. Gift cards make transactions easier for the user and also reduces the cost of printing bills, as well as the system more secure and traceable than cash payments. For example, dome gift cards have a PIN for the transaction and even if it is misplaced, it will not be an issue as it can be blocked.
Previously, supermarkets or large department stores were the only retail types that offered gift cards. However, now coffee shops and restaurants have also started offering gift cards through universal gift card providers. For instance, Disneyland and movie theatres offer gift cards through card providers and this trend is growing in developed countries, such as the United States and the United Kingdom. Moreover, in Korea, gift cards have gained importance as a payment method during the last five years due to the widespread acceptance of gift cards by individual and corporate consumers. A South Korean conglomerate offers its gift cards through its mobile application.
A gift card stores a specific amount that can be used in a wide variety of purchases. These cards can be classified into open- and closed-loop cards and can be issued by banks and retailers as a developmental strategy used to attract new customers, strengthen businesses, improve sales, increase brand awareness, and reduce fraud. Gift cards are available in both digital form and plastic-type. A gift card is a modern form of cash envelopes that were given on special occasions such as birthdays, marriages, etc. as they are intended for entertainment, dining, shopping, and other expenses. The growing use of e-commerce makes it easier for users to track, manage, and redeem gift cards.