A gift card saves your time and energy on choosing gifts and provides your loved ones with the flexibility to decide what to shop for.
It’s time to go easy on work, reflect on the year gone by, and get set to toast a new one. We’re on the heels of the festival season and it’s time to think gifting! So have you zeroed in on the gifts that you’ll shower on your aunts, uncles, cousins and friends?. Finding it a bit difficult?
Consider the prepaid gift card. It marries the benefits of a card and a gift voucher, making it a great idea when you aren’t sure what to gift someone.
THE BASICS
A prepaid gift card looks like a debit or credit card, with a signature panel at the back, a specific card number in front. It can be swiped at an outlet that accepts card payments. Like you would with a store gift voucher, you decide an amount for which the card will be worth. Hence the term ‘prepaid’ - since you’re already making the payment at the time of purchase.
So how does a gift card score? Let’s say you bought a gift voucher from Landmark for Rs 1,000 for your friend. Now, she can use the voucher only at a Landmark outlet.
But say instead that you got her a prepaid gift card for Rs 1,000. If she likes a book costing Rs 550 at Landmark, she can buy that. The remaining Rs 450 stays loaded on the card. Then your friend spots a great pair of earrings for Rs 100 in the store next door. Swipe, and the balance on the card is down to Rs 350.
In this manner, a number of purchases can be made until the amount loaded is exhausted. A gift card thus provides the flexibility to decide what to shop for. What’s more, if a gift card is lost or stolen, it can be reported to the issuing bank which will issue a new one. Of course, good things in life aren’t all free, so there will be a re-issue fee. But this will be borne by the receiver and not the buyer of the card.
HOW TO BUY
Most banks sell prepaid gift cards. . Just walk into the bank, fill up and submit the relevant form and make the payment. You will receive the card immediately, but the card will be activated only after payment is confirmed.
So if you use a cheque, it could take a day or two for it to be cleared and card usable.
You don’t need an account with the bank in order to buy a card from it. But in such a case, you do need to provide identification and address proof along with photographs. You can buy cards online through net banking in banks such as ICICI and HDFC.
Card validity depends on the issuing bank, but is usually one year from date of issue, or till the amount loaded is used up, whichever is earlier. But keep in mind that all branches of banks do not necessarily sell these cards.
AMOUNTS AND CHARGES
Amounts which can be loaded starts from Rs 500 and go up to Rs 50,000. But limits can vary. Axis Bank, for example, needs a minimum Rs 1,000. American Express has prepaid gift cards too, but only for four specific amounts.
Fee is also fairly standard at Rs 100 per card. Only a few, such as IDBI and Axis levy 1 per cent of the amount loaded if it crosses Rs 10,000. IDBI though, has an offer running till mid-February next year, charging a flat Rs 40 on all amounts. Other such as SBI and Union Bank are cheaper, charging Rs 50. Karur Vysya Bank levies no charges if you’re an account holder with the bank, or if the card amount is Rs 5,000 or below.
CAN AND CAN’T
So much for buying a card. What if you’re gifted one? Here are a few points to keep in mind. Barring a few, gift cards can be swiped at online stores as well. You can check the balance remaining on the card via ATM (for a few banks only), the bank’s Web site, a log-in and PIN is provided, or by calling customer care.
Post expiry of period, if there is an unused amount on the card, you can get this amount refunded, though some you will have to shell out on bank charges.
What you cannot do is withdraw cash on these cards. You cannot also top-up and reuse a card once you’ve exhausted the amount loaded.
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