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Gift Card Zeroed Out – Terms & Conditions
We talk about gift cards A LOT on this site. Not only do I make money and earn a lot of travel rewards by purchasing and selling gift cards, but I also use them quite often to save money on both personal and business purchases. So yes gift cards have been good to me, but there is one huge down side. THEY AREN’T MONEY!
Gift Card Terms & Conditions
What do I mean by that? When you are given a $100 bill are you provided with pages of terms governing that money? No, for the most part $100 is worth $100, but that isn’t the case with gift cards. While there are some rules governing gift cards (and they vary by state), for the most part gift card balances can be taken away if you are perceived as violating the terms.
And that happens. Mark previously talked about how Kohl’s does this and recently Vinh at Miles Per Day posted about how Amazon initially tried to take his gift card balances for some unknown terms violation. He got his money back without much hassle, but that doesn’t always happen. For example I am out a couple of hundred dollars from The Children’s Place hack and then there is Build-A-Bear.
Build-A-Bear Gift Card Drained
I used to buy/sell a few items from Build-A-Bear and used discounted gift cards to save even more. One day Sam’s Club had a nice sale offering these cards for 25% off. Knowing I would have some upcoming purchases at Build-A-Bear, I bought $1,000 worth of cards for $750.
One of the main reasons I went this route (even buying more than I needed immediately) was because I was buying these cards first hand from an authorized seller and thus should have more security with them. But what happens when the brand cancels your order, drains your card and then gives you a run around?
Well, when I placed an order for a few hundred dollars after receiving the cards, they flagged me in their system as a reseller and cancelled my order. Apparently they don’t like to sell to resellers which is fair enough. The only problem with this is that they emptied the gift cards when I submitted the order, but never credited back the amount when they cancelled the order.
We are in the process of escalation with them, but getting any help has been tedious. We have been told we violated gift card terms (which we haven’t), have been told to ask Sam’s Club and even more ridiculous stuff. Getting someone who knows what they are doing and is empowered is a joke. We ordered something. They took the money off of the gift cards. They cancelled the order. They never returned the money. Pretty simple right?
Not Just Build-A-Bear
This phenomenon isn’t just confined to Amazon and Build-A-Bear. Gift cards are not cash. They are pieces of plastic governed by a long list of terms you agree to when buying them. If you violate or even seemingly violate the terms then the brand can just take them or at least attempt to. I know for a fact that Walmart and Target have both taken similar approaches for online orders for example. I only use their gift cards in-store because of this.
There is a ton of fraud in the gift card space and for the most part brands are just trying to protect themselves. There are real bad guys who are violating terms and costing everyone a lot of money and sometimes we get caught in the middle. I am glad to see Amazon quickly fixed Vinh’s issue and just wish my pursuits with Build-A-Bear were more fruitful. In other words I understand their need for rules & caution, but don’t appreciate their bureaucracy and customer unfriendliness when it turns out we aren’t the bad guys!
Gift Card Best Practices
While the downsides of gift cards are something that everyone should be aware of, they also have very many good uses. Here are some things I do to ensure I have a good experience buying and using gift cards.
- Keep your receipts – You never know when something could go wrong and you will need to prove that you bought a card. Good record keeping always wins over bad record keeping.
- Secure your cards – If you aren’t going to use a card right away, secure it along with the receipt so you don’t need to search for documentation later if anything goes wrong.
- Be careful when using online – When you use a card in-store it is wiped and done when you complete the transaction. When shopping online orders can get cancelled for a variety of reasons. In many cases gift card balances aren’t proactively returned. Using gift cards in-store is much safer & having a tracking solution for online orders is essential.
- Make sure your savings are enough – If you aren’t saving money by using a gift card, then don’t! I only use gift cards when my savings is significant enough to measure. If I am going to save 1-5ish%, I would rather just use my credit card where I have far more protection.
If I could sum up my best advice it would be to keep good records, be careful about where you source gift cards, make sure they are saving you money and then to still be cautious about using them at some merchants.
Gift cards are a double edged sword. During my dealings with Build-A-Bear and other companies I have found that gift cards aren’t as safe and secure as once thought. Thankfully though they are still a tool I use to both generate money and points, albeit with much wider eyes than before.
Have you ever had issues with merchant gift cards? Share your stories in the comments!
Miles to Memories has partnered with CardRatings for our coverage of credit card products. Miles to Memories and CardRatings may receive a commission from card issuers.