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

Converting gift card balances into usable funds within a bank account is a common goal. While direct transfers are often not possible, several effective strategies exist. This guide explains various methods to move gift card value into personal banking accounts.

Differentiating Gift Card Types

Understanding the type of gift card you possess is the initial step in determining transferability. Open-loop gift cards, such as those branded with Visa, Mastercard, or American Express, function similarly to debit cards. These cards are accepted wherever the associated card network is honored, offering broad utility and flexibility, especially for online transactions.

In contrast, closed-loop gift cards are specific to a single merchant or brand, such as Amazon, Starbucks, or Best Buy. These cards can only be used for purchases at the issuing retailer and are typically not designed for direct bank transfers. Before attempting any transfer, examine the gift card for its type, potential activation or dormancy fees, and expiration date. A Personal Identification Number (PIN) is often required for online transactions or when linking the card to payment applications.

Transferring Via Digital Wallets and Payment Apps

Digital wallets and payment applications offer a method for transferring funds from open-loop gift cards. The process begins by linking the gift card to a chosen app, such as PayPal, Venmo, or Cash App. Users link the gift card as they would any other debit or credit card, entering the card number, expiration date, and the three or four-digit security code (CVV). Some applications or specific gift cards may also require the PIN for successful linking.

Once the open-loop gift card is added to a digital wallet or payment app, its balance becomes accessible within that platform. The next step involves initiating a transfer from the app’s balance to a linked bank account, a function typically labeled “cash out” or “transfer to bank.” Standard transfers usually process within one to three business days and often do not incur a fee. Most apps offer an instant transfer option for a fee, which commonly ranges from 1.75% to 2.5% of the transferred amount. Users should be aware of daily or monthly transaction limits that some apps impose on transfers.

Exploring Additional Conversion Options

Selling your gift card provides an alternative approach, especially useful for closed-loop cards that are difficult to transfer directly. Reputable online marketplaces, such as CardCash or Raise, allow individuals to list and sell unwanted gift cards. The process involves entering the card details and setting a selling price, which is typically a percentage of the card’s face value, often ranging from 80% to 95%. Once sold, the payment is usually issued to the seller, which can then be transferred to a bank account.

Using a gift card for bill payments or everyday purchases represents an indirect but effective way to free up cash in your bank account. For open-loop gift cards, consider using them to pay existing expenses like utility bills or credit card statements, provided the card is accepted. Similarly, using the gift card for regular shopping trips preserves the cash you would have otherwise spent, making that cash available for other uses or deposit. This strategy does not involve a direct transfer, but it achieves the same financial outcome by optimizing existing funds.

Some gift card exchange kiosks, like Coinstar Exchange, offer an immediate cash option for various gift cards. These kiosks typically provide instant payouts, though often at a significant discount compared to the card’s face value. While some open-loop gift cards with a PIN can be used at ATMs to withdraw cash, this functionality is rare and often incurs substantial fees, making it an uncommon and less efficient method for accessing funds.