How to Swap Gift Cards

Financial IQ

photo: playerx

Many people prefer giving or receiving gift cards to actual gifts that end up being returned or exchanged. Then again, not even gift cards are a sure bet to fit everyone’s taste, especially those that are limited to just one retailer. The result: many gift cards end up gathering dust in drawers or, worse, slowly eroding in a sea of expiration dates and fees.

Then again, many of them end up with services like,, and These sites buy unused gift cards for a portion of the face value, then resell them to consumers at a discount of 3% to 30%, depending the merchant.

Buy one of these gift cards, and you can use the full face value of the card and combine (or “stack”) that savings with other store coupons or sales.

Swap and Save

Bruce Bower, CEO of, says the concept appeals to people who have specific plans to shop at a particular merchant. “We just went through back-to-school season, so some parents knew they’d be shopping at Old Navy or Sears or Target,” he says. If, for example, you bought a Sears gift card at 5% off and the store was offering 30%, you’d get the savings of both deals.

But back-to-school season isn’t the only time to buy a discounted gift card. According to Anson Tsai, cofounder and CEO of, a friend bought several Tiffany’s gift cards from the site and eventually stockpiled enough to buy an engagement ring. Tsai says he buys gift cards to use for Mother’s Day. Inventory changes quickly, so most of the major swap sites let you sign up for email notifications when gift cards from favorite merchants become available.

Supply and Demand

The amount you can get for selling a gift card or the savings from buying one typically vary based on the popularity of the merchant. Bower says his company pays top price for cards from retailers or brands with wide consumer appeal: Wal-Mart, Target, Home Depot, grocery brands. “It’s easy for us to turn around and sell that card,” he says.

That means you might do well if you’re interested in selling one of those “national chain” cards, but since demand is high, the discount for buying one is lower. Regional chains, on the other hand, get a steeper discount to attract buyers.

Kwame Kuadey, CEO and Founder of, says there’s also a seasonal element in his site’s pricing. “After Christmas, we have a lot of restaurant gift cards, so at that time we have a huge inventory and you’re more likely to get a huge discount on restaurant gift cards,” he says. “During the summer, it’s hard to find restaurant gift cards, but you see a lot of department store cards.”

Buyer Beware

Before you pull out your credit card and place an order, check the site’s reputation. Unlike sites like eBay or Craigslist, where the buyer deals directly with the seller, most of the gift card swap sites act as the middleman and verify the value of the cards first.

Julia Scott, founder of, urges consumers to check whether the swap site guarantees the value of the card and look for other clues that it’s legit. “Always read the ‘About’ page and see how much the site discloses about themselves,” she adds. “The more they disclose about themselves, the more trust I would put in that site.” You should also check out the contact page for an email and a phone number. If email is the only contact information the site discloses, it might be hard to get in touch with a company should the need arise. Look for a phone number and test it out.

Also check if the gift card you’re buying has any fees or expiration dates attached. Tsai says does not carry gift cards that expire or have fees and allows consumers to return gift cards for a full refund within 100 days if they change their mind.

Gift cards are lightweight, so most of these sites offer free shipping. (If you’re dealing with a site that doesn’t, make sure the shipping costs don’t negate the savings of the gift card.) Some, like PlasticJungle, are even experimenting with e-gift cards that can be sent through email rather than snail mail, speeding up the process and alleviating the fear that the $500 gift card you just bought may never make it to your mailbox or somehow fall off your wallet. 

On the other hand, if you’re selling a gift card, Kuadey suggests sending a small card to see how the site does before you moving on to larger values.

Susan Johnston is a Boston-based freelance writer who covers business and lifestyle topics.

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