How to Get Money From a Gift Card to a Bank Account

Converting gift card balances into cash in a bank account is possible through several methods. While direct transfers are not always feasible, various financial platforms and alternative strategies can help access these funds.

Identifying Your Gift Card Type

Understanding your gift card type is key to determining conversion options. Gift cards fall into two main categories: open-loop and closed-loop cards. Open-loop gift cards function like debit cards, carrying logos of major payment networks such as Visa, Mastercard, American Express, or Discover. These cards are widely accepted wherever their network is honored, offering flexibility.

Closed-loop gift cards are restricted to specific merchants or affiliated businesses, like a particular retail store or restaurant. These cards lack a major payment network logo and can only be redeemed at the issuing merchant. Before conversion, check the card’s balance and review its terms and conditions, found on the back of the card or the issuer’s website.

Converting Through Payment Platforms

Payment platforms are a primary method for converting open-loop gift card balances into bank account funds. Platforms like PayPal, Venmo, and Cash App serve as intermediaries. To begin, link the open-loop gift card to your account on one of these platforms by adding it as a debit or credit card in the “Wallet” or “Payment Methods” section. Input the card number, expiration date, and security code (CVV).

Register the gift card with a billing address on the card issuer’s website before linking it. Once linked, initiate a transfer from the gift card to your platform balance. For example, Venmo uses an “Add Money” feature where you select the gift card as the source. After funds are in your platform balance, transfer them to a linked bank account.

Platforms offer two transfer options: standard and instant. Standard transfers are free and take one to three business days. Instant transfers are faster but incur a fee. Venmo and PayPal charge about 1.75% of the transfer amount (e.g., $0.25 to $25). Cash App’s instant transfer fees range from 0.5% to 1.75%, with a minimum fee of $0.25. Instant transfers complete within minutes to an hour.

Other Conversion Methods

Several alternative methods can convert gift card balances, particularly for closed-loop cards where direct payment platform transfers are not feasible.

Selling Gift Cards

One approach is selling the gift card through online marketplaces like CardCash. These sites allow you to list unwanted cards and receive a percentage of the face value. The payout can vary, typically ranging from 75% to 90% of the card’s value, depending on the retailer’s popularity and demand. Payouts are often via PayPal or direct deposit.

Purchasing Money Orders

Another method, for open-loop gift cards, involves purchasing a money order. Some post offices or grocery stores may allow using a prepaid debit card (like an open-loop gift card) to buy a money order, which can then be deposited into a bank account. This transaction may incur a small fee, typically ranging from under a dollar to a few dollars, depending on the location and amount. It is important to confirm that the specific location accepts gift cards for money order purchases beforehand.

Paying Bills Directly

Using an open-loop gift card to pay bills directly can free up cash in your bank account. Some utility companies, internet providers, or other service providers accept these cards for direct payments online or over the phone. Check with your biller to confirm this option. By using the gift card for a payment you would have otherwise made from your bank account, you effectively free up those funds in your bank account.

Reselling Purchased Items

For closed-loop gift cards, purchasing and reselling items is a strategy. Use the gift card to buy popular, high-demand items from the retailer that have good resale value, such as electronics or collectibles. These items can then be sold through online marketplaces like eBay or local classifieds, converting the gift card’s value into cash. The final amount received will depend on market demand and resale platform fees.

Important Details for Conversion

When converting gift card balances, several factors warrant consideration for a smooth and successful process. Most methods involve fees or charges that reduce the final amount received. Payment platforms charge fees for instant transfers, and gift card resale sites take a percentage of the card’s value. Money orders also have small purchase fees. Research and understand these costs before proceeding.

Gift cards have specific terms and conditions affecting their usability and value. These may include activation requirements, expiration dates, or restrictions on transactions like cash back. Reviewing the fine print on the card or the issuer’s website helps avoid unexpected issues. Larger transactions or transfers, especially through payment platforms, may trigger identity verification processes, requiring personal information to comply with financial regulations and prevent fraud.

Finally, exercising caution and prioritizing security is important when dealing with financial transactions online. Using reputable payment platforms and gift card exchange sites helps mitigate risks. Ensure websites are secure and be wary of requests for personal financial information through untrusted channels. These precautions protect your funds and personal data during conversion.