13 Reasons People Hate Gift Cards (And What To Do About Them)

Getting a gift card to a store you never shop at is its own kind of disappointment. It is not that the thought doesn't count — it is that the thought missed. The traditional single-store gift card puts enormous pressure on the giver to know exactly where someone spends their money, and most people just don't know that about each other well enough to get it right every time. Only 21% of gift cards are redeemable at more than one retailer, so the odds are already against the recipient getting something truly useful.

Gift card fraud is rampant. Criminals tamper with physical cards on store racks, scratch off the PIN, and put a new sticker over it. By the time someone buys the card and the recipient tries to use it, the balance is already gone. The FTC consistently ranks gift cards among the most commonly used payment methods in reported scams. A 2024 AARP report put gift card scam losses at a minimum of $212 million for the year — and that is only what gets reported. Older adults are hit especially hard.

A plain gift card with a generic holiday design doesn't say much about the person giving it. That reputation has followed gift cards around for decades, and honestly it is earned. You can have the best intentions in the world and still hand someone a piece of plastic that looks like you grabbed it off a rack at the checkout line on the way over — because that is exactly what most people do. Gifting is about the relationship between two people. A card that could have been bought for anyone, by anyone, doesn't reflect that.

Nobody wants to hand someone a gift card in a plain envelope or, worse, just hand it over bare. So most people buy a separate greeting card to go with it. That is another $6 or $7, another stop, another few minutes standing in a card aisle trying to find something that fits. The gift card and the greeting card come from entirely different places and feel that way when you put them together.

Sending a gift card digitally and then hearing nothing is genuinely uncomfortable. Did the email go to spam? Did they see it? Did they use it already and just not say anything? Did they forget? You want to follow up, but you also don't want to seem like you're fishing for a thank you. Physical cards have their own version of this — you can't know if the envelope made it until someone tells you.

Nearly $21 billion in gift card value goes unredeemed every year in the United States. Cards get forgotten in drawers. People spend $48 of a $50 card and never bother going back for the last two dollars. Stores close. Between 2005 and 2015, unredeemed balances totaled around $45.7 billion, most of which became free profit for the retailers who issued the cards. The industry term for it is breakage income. Retailers count on it.

One of the more frustrating surprises in the gift card world is pulling out a card you saved for something and finding it is worth less than when you got it. Some Visa, Mastercard, and American Express prepaid cards start charging inactivity fees if they sit unused for 12 months. Federal law provides some protection, but the rules vary by card type and state and aren't written on the front of the card in big letters. Most people only find out about the fees after the fact.

A gift card to a restaurant chain that doesn't have a location anywhere near the recipient is essentially useless. Same goes for a retail brand the person never shops at, or a store that closed since the card was purchased. About 12% of people have had a business shut down before they could use a gift card they were holding. That is not a fringe situation. It happens all the time, and the cardholder has no recourse.

Gift cards are surprisingly hard to keep track of. Givers don't know if a mailed card arrived. Recipients often have no easy way to check a balance without going to the retailer's website or dialing a 1-800 number and navigating a phone menu. Once you spend part of the balance, remembering exactly what's left is a guessing game. Most cards have no digital record tied to the person holding them.

The standard policy on most gift cards is final sale, full stop. If the card never arrived, the retailer typically wants tracking proof before doing anything. If the card was drained by fraud, you're often told it's not their problem. Gift card fraud losses jumped 364% between 2018 and 2021 partly because bad actors knew consumers had almost no leverage. The harder it is to get a refund, the more emboldened scammers become.

A lost gift card is usually just gone. Most store-specific cards have no registration system, so there is no way to prove you owned the card or freeze what's left on it. 17% of people have lost at least one gift card at some point, and most of them never saw that money again. Unlike a lost debit card where you can call your bank, a lost store gift card typically offers zero recourse.

Gift cards carry a stigma and part of it is fair. Grabbing a pre-loaded card off a rack on the way to someone's birthday party and handing it over in a generic envelope sends a message, even if you didn't mean it to. Even when giving someone the freedom to choose is genuinely thoughtful, a blank card with a stock photo doesn't communicate that. Presentation is part of the gift. When the presentation says nothing, the gift says nothing.

Plenty of people save gift cards for something specific and then go to use it months later only to find the value has dropped or the card no longer works. More than one in five people have had a gift card expire before using it. Federal law says most cards can't expire for five years, but inactivity fees can start eating into the balance after 12 months on certain card types. The rules differ depending on who issued the card, and they are rarely explained upfront.