Can You Transfer Gift Card Money to Your Bank Account?

Gift cards are a common form of payment and gifting, offering convenience for both givers and recipients. Many consumers wonder if the value on a gift card can be converted to cash and transferred to a personal bank account. This depends on the gift card’s characteristics and the methods used.

Understanding Gift Card Types

Transferring gift card funds to a bank account depends on whether the card is open-loop or closed-loop. Open-loop gift cards are issued by major payment networks, such as Visa, Mastercard, American Express, or Discover. These cards function much like debit cards and can be used wherever the respective payment network is accepted, providing broad spending flexibility. They typically bear the logo of the issuing payment network and are not tied to a single retailer.

Closed-loop gift cards, conversely, are specific to a single merchant or a limited group of affiliated retailers. Examples include gift cards for a particular clothing store, coffee shop, or online marketplace. These cards can only be redeemed at the issuing store or its website and do not carry the logo of a major payment processor. Their restricted usage means they generally lack the inherent functionality for direct cash access or bank transfers.

Methods for Converting Gift Cards to Cash

Even if a direct bank transfer is not possible, several indirect methods exist to convert gift card value into a more liquid form. Selling unwanted gift cards through online marketplaces is a common approach. Platforms like CardCash, Raise, or Gameflip facilitate the sale of gift cards, at a discount to their face value. Sellers typically receive a percentage of the card’s value, with fees or commissions ranging from a few percent up to 15% or more, depending on the platform and card brand.

Another method involves purchasing an item with the gift card and then attempting to return it for cash. Most retailers have policies that refund the purchase to the original form of payment. If an item was bought with a gift card, the refund will typically be issued back to the same gift card or as a new store credit. Obtaining a cash refund for a gift card purchase is not standard practice, to prevent fraud.

For open-loop gift cards, purchasing a money order is sometimes a viable option. This converts the card’s value into an instrument that can be deposited into a bank account, though it incurs a small fee. This method is typically limited to open-loop cards.

Transferring Funds from Open-Loop Cards to Bank Accounts

For open-loop gift cards, a direct route to transfer funds to a bank account involves using third-party payment platforms. Services like PayPal or Venmo can act as intermediaries for this process. These platforms allow users to link their open-loop gift cards, treating them similarly to debit or credit cards.

The process involves adding the open-loop gift card as a payment method within the chosen platform’s digital wallet. This requires entering the card number, expiration date, security code, and a billing address, which might need to be registered with the gift card issuer. Once the card is linked, funds can be transferred from the gift card balance to the platform’s digital balance.

The final step is to initiate a withdrawal from the digital platform’s balance to a linked bank account. This is a two-step process: money moves from the card to the platform, then from the platform to the bank. While some platforms may not charge a fee for adding the card, fees can apply for transferring money to a bank account, ranging from minimal to a few dollars per transaction. Review the terms and conditions of the gift card and the third-party platform for any applicable fees or transfer limits.