Billions are going unspent in gift cards and only the corporations are winning

Giving a gift card to someone when you really have no idea what to get them may seem like a great idea. But will the person receiving your gift actually use it to buy something?

The answer is probably not according to a report from Credit Summit that showed about two-thirds of American consumers don’t end up using the gift cards they’ve been given. 

“It should be win-win. But gift cards aren’t always perfect,” Credit Summit Vice President and editor Rebecca Stumpf wrote. “A lot of them go unspent.” So how bad is the issue? 

Well, it turns out there is roughly $21 billion floating around in unspent money, and that means the only real winner when you don’t spend your gift cards are the corporations. 

There are a number of reasons why gift cards aren’t getting used. It turns out the most likely explanations are that people just misplace the cards or forget that they have them. 

Of the 1200 Americans surveyed, 24.67% said they had previously lost a gift card while 57% said they had never lost or misplaced a card that had been given to them as a gift. 

Interestingly, 5.17% of people surveyed told Credit Summit they’d lost a gift card due to damage while 9.75% lost a card to expiration dates or because it was no longer valid. 

Roughly 39% of people said they’d misplaced a gift card before and an overwhelming majority of about 63% said they still had an unspent gift card at the time of the survey. 

Other reasons why gift cards aren’t getting used include some people seeing no value in redeeming the cards or because the gift isn’t to somewhere a person typically shops. 

“Gift cards are extremely popular and almost everyone enjoys getting them. But many people leave them sitting in a drawer to redeem on a special occasion,” Stumpf said to CNN’s Parija Kavilanz

Instead of letting your gift cards waste away in a junk drawer at home while you save them for a special occasion, Stumpf suggests using them as quickly as you can to avoid the pitfalls that come from absent balances. 

“If someone has given you a gift card, they want you to spend the money,” Stumpf said,  and it's advice you should heed if you don’t want companies profiting from unspent cards.  

Even if you don’t plan on using a gift card because you don’t see the value in using it or you don’t shop at the store where the card was issued, you should still consider swapping it or selling it according to Credit Summit. 

“If there’s a card you won’t use, it’s OK to regift it or sell it,” Stumpf wrote in her analysis of the Credit Summit survey, adding that “there’s no real advantage to saving them.”

“Use them, regift them, or donate them especially if they have an expiration date. There are companies like Gyft that allow you to redeem your card,” suggested West Chester University Professor Dr. Monica Zimmerman when asked about saving cards. 

Business Wire estimated the total value of the U.S. gift card market in 2022 was $162.1 billion and noted that number was expected to rise to 388.8 billion by 2027, meaning we could see the cost of unused cards rise substantially in the near future.