What Is A Digital Gift Card?

Gift-giving has gone digital!

What is a digital gift card (also known as an electronic or e gift card)? From last-minute presents to reducing plastic waste, digital gift cards are changing the way we shop and share our love with friends and family.

In this blog post, we’ll explore the world of digital gift cards, how they work, and why they’re an excellent choice for convenience and sustainability.

what is a digital gift card


Key takeaways

  • E gift cards have revolutionized the convenience of gifting.
  • There are two types - open-loop and closed-loop - and both can be used online and in stores.
  • Before purchasing an e gift card, make sure you understand any restrictions or limitations.

Understanding digital gift cards

Digital gift cards, also known as e gift cards, represent a transformative shift in gift-giving. 

These virtual gift cards combine traditional sentimentality with modern convenience, transforming the way we express affection. 

E gift cards offer a quick and paperless alternative to traditional gift cards. They are digital, which means they can be personalized and delivered instantly for the recipient. 

Unlike physical gift cards, e-gift cards are not limited by location, making them a modern and efficient way to give and receive gifts.

Let’s dig deeper into the nature of a digital gift card, and the ways it stands apart from its plastic equivalent.

Defining digital gift cards

A digital gift card is essentially a cash substitute that you can email or send via a mobile app to a recipient. It comes with a unique code that can be used for online purchases or in-store transactions. 

The main difference between e gift cards and a traditional physical gift card is the form: digital gift cards are sent electronically, while physical gift cards require tangible items you can hold in your hand.

Digital gift cards make gift-giving super easy and safe. You don't have to share your personal information with anyone; you can use it at many places. They're perfect for any occasion!

Types of digital gift cards

You can classify digital gift cards into two main categories: open-loop gift cards and closed-loop. 

Open-loop digital gift cards are accepted at multiple retailers, allowing the recipient to shop at various stores and services. On the other hand, closed-loop e gift cards are specific to a single retailer or service, limiting the places where they can be used.

Examples of a digital gift card include:

  • Visa or Mastercard eGift Cards
  • Multi-Store eGift Cards
  • Amazon.com eGift Cards
  • Target eGift Cards
  • Streaming eGift Cards
  • Cash App Gift Cards
  • Apple Gift Cards
  • DoorDash Gift Cards
  • Backcountry eGift Certificate
  • Airbnb Gift Cards

The variety of options ensures a perfect digital gift card for everyone, no matter their tastes or preferences.

The process of purchasing and giving digital gift cards


Things you'll need to give a digital gift card

  • Choice of gift card: A gift card that matches the recipient’s interests.
  • Payment information: Credit card or other payment details.
  • Recipient’s contact information: Email address or mobile number, depending on the delivery method.
  • Personal message (optional): A customized message to accompany the gift card.
  • Recipient's name: For personalization and verification.


Purchasing and sending digital gift cards is straightforward and convenient. 

Begin by picking a gift card that aligns with the recipient's likes and needs.

After selecting, add the gift card to your cart or proceed with the purchase option provided.

During checkout, you'll be asked to enter your payment details and the recipient's email address or contact information, depending on the delivery method available.

Upon completing the purchase, you will receive a confirmation, and the digital gift card will be on its way to the recipient, ready for them to enjoy!


Redeeming and using digital gift cards

If you’re the recipient of a digital gift card, then redeeming a digital gift card is as effortless as giving one. 

Recipients need only to apply the unique code or barcode they received via email, bridging the gap between the virtual gift and their desired purchases. 

Whether indulging in online shopping or opting for an in-person experience, the gift card adapts to the recipient's preferred shopping method. Its versatility not only grants the freedom to shop from the comfort of one's home but also offers the opportunity for a tailored shopping experience in store. 

The ease and adaptability of using digital gift cards make it convenient for recipients to find and buy exactly what they want, reflecting their personal style and needs.

Checking the balance of a digital gift card

Monitoring the remaining balance on a digital gift card is usually a straightforward task. 

Most retailers and services offer online balance check options, allowing users to monitor their spending and check how much they have left to spend. 

Some digital gift cards also provide customer service numbers, so the balance can be checked over the phone.

what is a digital gift card


Comparing digital gift cards with debit cards and prepaid credit cards

Digital gift cards, debit cards, and prepaid credit cards are all prepaid payment options that require funding before they can be used.

Each serves the purpose of enabling purchases, but they differ significantly in functionality and application.


Debit cards and prepaid credit cards

Debit cards are directly connected to your bank account, allowing transactions that draw from your account's funds. These cards are accepted virtually anywhere card payments are made. 

On the other hand, prepaid credit cards operate independently of a bank account and need to be preloaded with funds. 

These services are designed for personal use such as managing finances or ensuring safety while traveling, and they do not have any impact on your credit score.

Digital gift cards

Digital gift cards are designed with gifting in mind.

Digital gift cards offer a personalized and thoughtful way to show appreciation, delivered instantly through email or mobile applications. 

They provide the ultimate flexibility, usable for both online shopping and in-store purchases. The convenience and versatility of digital gift cards make them an excellent choice for those looking to offer more than just a gift but also the experience of choosing it.

Understanding these differences can guide consumers in selecting the most suitable payment method for their purchasing needs and gifting occasions. 

Digital gift cards stand out for their ease of use and the personalized touch they add to the gift-giving experience.


Benefits and drawbacks of digital gift cards

There are numerous benefits to choosing digital gift cards over their traditional physical equivalents. Here are some of the advantages:

  • They provide the recipient with the freedom to choose items they truly want
  • They can be sent quickly
  • They help reduce plastic waste
  • They enable recipients to shop online or in-store, offering flexibility and convenience.

Despite these benefits, digital gift cards do have some drawbacks to consider. Here are some of the disadvantages:

  • Closed-loop gift cards limit the recipient’s shopping options to a single retailer or service. 
  • Concerns about the security of digital gift cards, as the unique code, can potentially be intercepted or hacked.

Despite these drawbacks, the benefits of digital gift cards often outweigh the disadvantages. 

They provide a convenient and environmentally friendly option for gift-giving while offering recipients the flexibility to shop at their preferred retailers and services.

Tips for choosing the right digital gift card

what is a digital gift card

It's important to be aware of the terms and conditions associated with an e gift card before making a purchase. This includes understanding any expiration dates or specific conditions for use. 

Also, verifying the gift card's validity and security is essential for a hassle-free gifting process. Taking the time to explore the variety of digital gift cards offered by various retailers and services allows you to select one that aligns perfectly with the recipient's tastes and interests, ensuring your gift stands out and is cherished.

Wrapping up

To wrap up, e gift cards have revolutionized how we give gifts, bringing unmatched convenience, adaptability, and eco-friendliness to the table. 

This article has shed light on the diverse range of digital gift cards available and offered practical advice for choosing the ideal one. 

Step into the modern era of gift-giving with digital gift cards and elevate your upcoming celebrations to new heights.

Olivia Gittens
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