Last Minute Holiday Gift Card? Know the Differences

Dec 22, 2011 – The pressure is on. Only a couple more days to get your holiday shopping done. At this point, giving a prepaid card as a gift looks like a good choice not only because it will be easier for you, but most likely preferred by the recipient. The only question is, “Which card should I get?”. There are differences between card types that you should be aware of:

  • Closed LoopClosed loop cards are typically retail merchant specific, so you can only use them in the store chain that you purchased them from.
  • Open Loop – You will be able to use open loop cards anywhere that accepts one of the major network branded cards, not just the retailer you purchased them from. These might also be General Purpose Reloadable or “GPR” prepaid cards.
  • Expiration Date – New federal legislation has expanded protections when it comes to the expiration of gift cards. Some older cards may not be protected, so always check each cards terms and conditions.
  • Closed Loop Card Fees – One of the benefits of using these merchant specific cards is that they more than likely don’t have any fees associated with them as the retailer intends to encourage you to shop at their store.
  • Open Loop “Gift” Card Fees – These cards usually have some sort of purchase fee ranging from a couple of bucks to five or six dollars. After that fee is paid up front, there probably aren’t any further fees associated with the card. Once again, always check to make sure.
  • Open Loop “GPR” Card Fees – These cards are probably not best suited as a gift unless you intend to help reload the card for the recipient throughout the year. There can be many fees associated with these cards including – Activation, Monthly Maintenance, Inactivity, ATM Withdrawal and Reloading.

There can be many nuances to these different cards, so explore available resources when you are deciding how to get a prepaid debit card. Now get cracking! Happy Holidays!

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