Does purchasing a retail store gift card for less than its face value – basically, getting free money – sound too good to be true? It’s usually not. Discounted gift card websites buy new or partially used gift cards from consumers who would rather have cash for less than the cards are worth or take a flat commission based on the gift card’s selling price. Then, these sites resell the cards to consumers who do want them for discounts of around 2% to 10%, depending on the retailer. Discounted gift card websites make a profit on the difference between what they buy and sell the cards for, sellers get cash for gift cards they don't want to use and buyers get a discount when shopping at their favorite stores. It seems like everyone wins.

But is it safe to buy a discounted gift card online? Couldn’t the seller use the card’s balance after you buy it and leave you with a worthless gift code or piece of plastic? Could the websites themselves be scams, taking your money and sending you a physical gift card or electronic gift code that appears to be legitimate but is actually worthless? This article will explore these common concerns to see how much of a risk you’re taking if you buy a discounted gift card online. (Find out where to buy these cards in Top Websites for Discounted Gift Cards.)

Can Sellers Empty the Card After You Buy It?

Technically, yes: A dishonest seller could use a gift card code after selling the card or the code online to go after the balance that's on the card you bought. That’s why you need to check the discounted gift card website’s policies, which are often on its FAQ page, to see what buyer protections it offers. CardCash, for example, guarantees that the gift card you buy will have the stated balance for 45 days after you receive your order. Cardpool and GiftCards.com guarantee the balance for 100 days from your purchase date, with a claims limit of $1,000 per customer. GiftCards.com does not guarantee the value of electronic or mobile gift cards, however. Raise guarantees the value of your gift card for up to 60 days from your purchase date. 

When you receive your gift card, check the balance right away so you can contact the discounted gift card vendor if there’s a problem. Also, because there is some risk involved, it’s best to use your gift cards shortly after you receive them.

Are Discounted Gift Card Websites Scams?

There have been reports of fraudulent discounted gift card websites that stole money from consumers. Researching the site’s reputation online before you buy can prevent you from purchasing from one of these sites. 

It’s also possible to get ripped off when you buy a brand new gift card directly from the store, however. While not common, it’s possible that a thief has copied the numbers from the “new” card you think you’re buying in the store and will use the balance after you buy the card and the cashier activates it. To protect against this, Scambusters.org recommends checking gift cards for evidence of tampering before buying them, keeping your receipt showing the card’s value at the time you purchased it and registering your gift card at the retailer’s website when possible. Problems with gift card fraud aren’t unique to discounted gift card websites.

Can You Get Your Money Back?

You should also check the discounted gift card seller’s general return policies if you think you might experience buyer’s remorse. Cardpool will let you return an unwanted, unused physical gift card – but not an electronic or mobile gift card – for a full refund. Raise does not allow customers to return a gift card simply because they’ve changed their mind, but they can get their money back if the gift card they purchase arrives inactive, has a different balance than what they bought, is for the wrong store or doesn’t arrive within 30 days of purchase.

GiftCards.com, like Cardpool, only accepts returns of physical gift cards. You must initiate the refund request by emailing GiftCards.com, and you must not have used the gift card at all since you purchased it. This return policy applies for a full year from your date of purchase.

If your purchase isn’t eligible for a refund, one option is to resell your unwanted gift card to the site from which you bought it – or to a competing site. In fact, with some sites, such as CardCash, this is your only option. You’ll lose a percentage of what you paid, but that’s better than never using an unwanted card and wasting 100% of what you paid.

The Bottom Line

The risks you take when you buy a discounted gift card online should be minimal as long as the site guarantees the value of the gift cards it sells. Make sure to review the site’s guarantee and return policies before you buy and don’t take a chance on a site with policies that don’t seem buyer friendly.

Use your cards as soon as possible after purchase and, as an extra form of protection, buy your discounted gift cards with a credit card. If the gift card website won’t resolve a problem with a bad purchase, you can initiate a chargeback through your credit card issuer and get your money back that way. (We explain more about this process in How To Dispute A Credit Card Charge.)