ó A gift card can be the perfect gift. Except when itís
say your generous out-of-town aunt sends you a $100 gift
card for your birthday good at AMC theaters. Too bad the
theater chain in your neighborhood is a Cinemark.
maybe your clueless cousin bought you a $50 card to
PetSmart, forgetting that your Doberman, Cuddles, had
of tossing those rejects in a junk drawer or re-gifting
them, a growing number of consumers are using online
gift card exchanges to trade their unused cards for
cash. At the same time, savvy shoppers are picking up
those castoffs at a discount ó in essence devising
their own way to get markdowns on goods they buy.
estimated $500 million to $700 million worth of gift
cards went unused last year, according to CEB TowerGroup
in Arlington, Va. Thatís down from close to $7 billion
in 2008 before regulators eliminated numerous junk fees
and extended expiration dates to a minimum of five
use exchanges primarily to buy cards because I find itís
an easy way to save," said Kyle Taylor, founder of
The Penny Hoarder in St. Petersburg, Fla., a blog
dedicated to offbeat ways to make and save money.
"Iím saving even before using any coupons."
has used exchanges to sell a couple of unwanted cards
and to buy around 50 of them over the last few years.
bought a home last year and needed a washer, dryer and
fridge," he said. "I bought Loweís cards and
stacked them with coupons. I was able to save a
said heís never had any problems using exchanges or
there are risks, so it helps to know how the exchanges
work before plunging in.
sellers shouldnít expect to get paid full price.
are set based on supply and demand, plus exchanges take
a cut. Sellers type in the gift card number, PIN and
cardís value, then send in the card and get paid
through PayPal, via check, direct deposit or even
another gift card. Other sites list cards from sellers
who get paid only if the card is sold.
from big-name retailers such as Wal-Mart, Target and
Home Depot will fetch the most cash for sellers,
sometimes as much as 95 percent of the balance, Taylor
said. Cards from lesser known, regional stores might be
worth only 70 percent to 80 percent of their value.
the flip side, buyers will find the biggest bargains on
cards from smaller, less popular stores.
Cardcash.com, for example, American Eagle Outfitters
gift cards were recently going for 30 percent off (a
$200 card was selling for $140), while Best Buy cards
were being marked down by only 2 percent to 4 percent.
recommends using a listings aggregator, such as
GiftCardGranny.com, which makes it easy to compare
offerings from numerous exchanges. Gift Card Granny gets
paid for referrals and "has a history of presenting
reputable sites," he said.
also recommends that buyers check the balance on a card
as soon as they receive it.
sites will verify the balance of gift cards before
selling them and offer a money-back guarantee or
replacement if the amount isnít as promised, according
to the Retail Gift Card Association in Washington, D.C.
In addition, the best sites wonít take long to pay
sellers and they offer tracking to help protect sellers
if payments are lost.
association has been working with several "higher
end, reputable" exchanges, including Raise.com and
Cardpool.com, on a set of best practices for exchanges
to follow to help protect consumers, said Timm Walsh,
chairman of the association.
association is concerned with helping retailers protect
their brands from thieves, he said. The group hopes to
have the best practices guidelines ready in time for the
busy holiday shopping season this year.
said potential problems with gift card exchanges are
similar to risks associated with other second-hand
you buy something used, you hope when you go to plug it
in, it works," Walsh said.
a lot of cases, consumers donít understand that if I
sell a card, I still have the keys to take the account
and PIN and still redeem it before the person who bought
it redeems it."
exchanges for concerts and professional sporting events
have developed ways over many years to help protect
buyers and sellers, he said, but the gift card exchange
industry "is still developing and evolving."
like everything else, the better ones will thrive and
the others will go by the wayside," he said.
you donít want to have the question in the back of
your mind, ĎWill it work?í then your best bet still
is to buy directly from the retailer."
more tips on using gift card exchanges, visit