Can You Use a Gift Card for an Online Purchase?

Using a gift card for online purchases is generally possible and offers a convenient way to apply a gifted value towards digital transactions. While the process is typically straightforward, distinctions exist depending on the gift card type.

Understanding Your Gift Card

Before attempting an online purchase, identify the specific type of gift card you possess, as this determines where and how it can be used. Gift cards primarily fall into two categories: open-loop and closed-loop. Understanding these differences is the first step toward successful online redemption.

Open-loop gift cards are backed by major payment networks such as Visa, Mastercard, or American Express. These cards function much like a debit or credit card and are accepted by any online merchant that processes payments through their respective networks. They offer broad versatility, allowing purchases across a wide array of retailers and service providers.

Closed-loop gift cards, in contrast, are issued by a specific retailer or brand. These cards are exclusively redeemable for goods or services from that particular merchant, whether online or in their physical stores. Examples include gift cards for a specific clothing store or a coffee shop chain, where the card’s use is confined to that brand’s ecosystem.

Steps to Use a Gift Card Online

Using a gift card for an online purchase involves a few steps during checkout. The method depends on whether the card is open-loop or closed-loop. Navigate to the payment section of the online retailer’s website.

For open-loop cards, select “credit card” or “debit card” as your payment option, rather than a specific “gift card” field. Input the 16-digit card number, the expiration date, and the three- or four-digit security code (CVV/CVC) typically found on the back of the card. Some open-loop cards, especially those not linked to a personal bank account, might require prior registration with a billing address to prevent fraud and ensure successful online transactions.

For closed-loop cards, look for a specific “gift card,” “redeem gift card,” or “apply gift card” option during checkout. This option often prompts you to enter the gift card number and a PIN, which is frequently located under a scratch-off panel on the back of the card. After entering the required details, the system will apply the card’s balance to your order total.

Maximizing Online Gift Card Use

To maximize gift card value online, consider these tips. Always check the exact balance on your gift card before making a purchase. This can be done by visiting the issuer’s website, calling a toll-free number, or using a mobile app. Knowing the balance helps prevent declined transactions if the purchase exceeds the card’s value.

For purchases that exceed the gift card’s balance, many online retailers allow for split payments. This means you can use the gift card for a portion of the total and then cover the remaining amount with another payment method, such as a credit or debit card. Some platforms may require you to apply the gift card amount first, with the option to then add a secondary payment method for the outstanding balance.

It is also advisable to review the terms and conditions associated with your gift card. While federal law generally protects gift cards from expiring for at least five years from the date of activation and limits dormancy or inactivity fees, specific conditions may apply. Some cards might have usage restrictions, such as not being redeemable for certain types of purchases or requiring activation before online use.