International payments generally involve substantial costs for people who want to initiate the transaction. People must pay multiple fees through traditional money transfers when they help family members or friends or pay for international services. International money transfers and wire services charge high fees to clients, while PayPal, Western Union, and their digital equivalents require payment of service fees and currency exchange rate premiums. As an alternative, sending money with gift cards is emerging as a more affordable option, helping users bypass many of these traditional costs.
Increasing financial transfer costs have driven people to find alternate methods of moving money across international borders. Gift cards have become an increasingly popular budget-friendly choice for money transmission. Their initial unorthodox character belies their effectiveness for cost-efficient monetary transfers in select situations.
Understanding how to send money through gift cards tracks down and eradicates fees to establish itself as a better financial solution.
Traditional Money Transfer Fees: A Breakdown
Before understanding how gift cards save you money, it’s essential to know where traditional systems burden you with fees:
Bank Transfer Fees
Banks usually charge a flat fee for international wire transfers, ranging from $10 to $50 per transaction. Additionally, intermediary banks may deduct a portion from the transferred amount, reducing the recipient’s receipt.
Wire Transfer Fees
Services like SWIFT or domestic wire systems charge processing fees, accumulating when multiple banks are involved. It’s not unusual for total fees to exceed $60, especially for international transfers.
Service Fees with Companies Like Western Union and MoneyGram
These companies specialize in money transfers but often charge between 1% and 10% of the total amount sent. They also apply lower exchange rates, maximizing their cut on currency conversions.
The Impact on Senders and Recipients
When you factor in hidden fees and exchange rate differences, the final cost of sending $100 might easily reach $110- $120. This significantly loses both senders and recipients, especially with regular transfers.
Read related blogs: The Benefits of Using Gift Cards to Send Money Abroad
How Gift Cards Help Save on Fees
Using gift cards to transfer value offers a simple solution to this fee-heavy ecosystem. When you send someone a gift card instead of transferring cash, you typically avoid transaction fees entirely. The full value of the card is delivered, with no deductions.
Gift cards function like digital currency that the recipient can spend directly. When used wisely, especially globally accepted or region-specific cards, they can provide full value without banking intermediaries, conversion fees, or transaction charges.
Types of Gift Cards You Can Use to Send Money
Different types of gift cards offer flexible, fee-free ways to send money, each suited to various needs and recipient preferences.
Prepaid Cards (Visa/Mastercard)
Prepaid Visa and Mastercard gift cards work just like debit cards. They can be loaded with a specific amount and used worldwide wherever those card networks are accepted.
Benefits:
- Universally accepted.
- No need for a bank account.
- No fees for the recipient to use the card.
- Instant digital delivery options are available.
They are perfect for sending money to someone who may not have access to a bank but can use a card to shop online or in-store.
Retailer-Specific Gift Cards (Amazon, Flipkart, etc.)
These are ideal when you know the recipient’s needs and where they shop. Amazon, Flipkart, Walmart, and other retailer-specific gift cards allow for direct purchases, bypassing the need to exchange currency altogether.
Advantages:
- Immediate use with no fees.
- Regional cards can help bypass international delivery or shipping issues.
- Often available with regional discounts or bonuses.
Fee-Free Transfer Platforms Using Gift Cards
Several online platforms now support purchasing, transferring, and redeeming gift cards without extra fees. Some of these include:
1. Gyft: Gyft lets users buy, send, and manage gift cards digitally without extra fees. It supports popular brands and offers simple delivery via email or mobile.
2. eGifter: eGifter offers fee-free gift card purchases and group gifting options, enabling users to send gift cards instantly via email or SMS with added personalization.
3. Rybbon: Rybbon specializes in sending digital gift cards as rewards or incentives, offering businesses a fee-free, automated way to distribute branded gift cards globally.
4. Bitrefill: Bitrefill allows users to buy gift cards using cryptocurrency, supports global brands, and offers instant, fee-free delivery with the added benefit of decentralized payment methods.
5. Tango Card: Tango Card provides digital gift cards for businesses to use as rewards or employee incentives. It features no additional transfer fees and flexible global delivery options.
These services allow you to send gift cards via email or SMS, making them a simple alternative to cash transfers, often with zero fees.
The Advantages of Zero Transfer Fees with Gift Cards
Zero transfer fees on gift cards mean more of your money reaches loved ones, providing savings, transparency, and greater value for recipients.
Cost Savings for Senders
Gift cards help eliminate intermediaries. When you send a $100 Amazon gift card, the recipient gets exactly $100 worth of value. The transfer provider does not receive a 3% cut, no $20 international wire fee, and no hidden service charges.
Sending money monthly could add up to hundreds of dollars in yearly savings.
No Hidden Charges
Many traditional services include hidden fees that go unnoticed, like:
1. Marked-up Exchange Rates: Traditional transfer services often add a margin to currency exchange rates, making you pay more than the real market rate without disclosing it.
2. Processing Fees: Many banks or platforms charge backend fees for handling the transaction, even after charging a flat or percentage-based transfer fee upfront.
3. Service Fees: Companies like Western Union or PayPal may include service charges for using their platform, especially for international or expedited transfers.
With gift cards, what you see is what you pay for. There are no hidden costs when purchasing a digital gift card.
Better Exchange Rates with Gift Cards
Another significant cost in international transfers is the exchange rate markup. Services like PayPal and Western Union use below-market exchange rates, pocketing the difference.
Some international gift card services or multi-currency prepaid cards offer more favorable rates. Alternatively, they bypass currency exchange altogether by letting the recipient shop in their local currency with a region-specific card.
This transparency and efficiency often lead to more value for the recipient.
Instant Delivery
Most gift cards, particularly digital ones, are sent immediately through email or text. This eliminates the waiting time associated with bank transaction processing or wire transfers.
Read related blogs: Zero Transfer Fees: A Guide to Sending Money via Gift Cards
No Bank Accounts Required
Recipients don’t need a bank account, ID verification, or digital wallets. This is especially beneficial for sending money to:
Students: Students without bank accounts can easily receive gift cards for essentials like books, food, or subscriptions—no banking setup needed.
Elderly Family Members: Elderly recipients may struggle with digital banking; gift cards offer a simple, direct way to receive and use money without hassle.
Friends in Countries with Limited Banking Access: In regions with poor banking infrastructure, gift cards bypass the need for accounts, providing immediate value that can be spent locally.
No Paperwork or Delays
Forget filling out transfer forms or worrying about bank hours. Sending a gift card takes a few clicks, and the process is done.
Potential Challenges and Limitations
While gift cards can be an effective way to save on fees, they do come with certain limitations:
Limited Redemption Options
Some cards may only work in specific regions or stores. Confirming that the recipient can redeem the gift card in their location is crucial.
Risk of Fraud
As gift cards are often non-replaceable, losing access to a card or sending it to the wrong person could result in losing funds. Always use secure platforms.
Acceptance Issues
Retail-specific cards might not be accepted for all products or restricted to specific regions. Visa and Mastercard prepaid cards offer more flexibility in this regard.
Read related blogs: How to Send Money Internationally Using Gift Cards
Comparison: Gift Cards vs. Traditional Money Transfers
Here’s a brief comparison table to help visualize the differences:
| Feature | Gift Cards | Bank Transfers | Money Transfer Services | Digital Wallets |
| Fees | Often none | $10–$50 | 1–10% of the amount | 1–3% of the amount |
| Speed | Instant | 1–5 business days | Minutes to hours | Instant to 24 hrs |
| Exchange Rate | Fair (or bypassed) | Marked-up | Marked-up | Marked-up |
| Ease of Use | Very easy | Requires account | Needs verification | App-based |
| Recipient Needs Bank Account? | No | Yes | Often yes | Not always |
Conclusion
In a world where money transfer fees are rising and financial transparency is more important than ever, gift cards offer a practical, fee-free alternative for sending money. They’re fast, simple, and cost-effective, and in many cases, they bypass the costly overhead of banks and transfer agencies altogether.
Whether supporting family abroad, sending a birthday gift, or paying someone for a service, using gift cards can save money and hassle. While they’re not perfect for every scenario, they’re a highly effective tool in the proper context, especially for those looking to cut costs and send value efficiently.
Beem’s Send Now, Pay Later™ redefines online money transfers with instant delivery and a recipient-first approach. Whether you’re responding to a financial emergency or sending a thoughtful gift, Beem ensures your funds arrive instantly. No bank account? No worries—Beem makes digital remittances accessible to everyone, regardless of banking status.
So next time you’re about to wire money, consider whether a gift card might be a better, smarter option.
FAQs: Sending Money with Gift Cards Can Help You Save on Fees
Are gift cards fee-free for international transfers?
Yes, in most cases. Digital gift cards don’t include transaction fees and deliver full value to the recipient.
What types of gift cards can be used to send money abroad?
Prepaid Visa/Mastercard, Amazon, Flipkart, and other major retailer cards are commonly used.
Are there any hidden fees when using gift cards to send money?
Generally, no, especially with reputable platforms. Always check the terms before purchasing.
Can I send large amounts of money with gift cards?
Yes, but per-card limits (e.g., $500/card) may exist. You can split large amounts across multiple cards.
How can I ensure the recipient can use the gift card in their country?
Choose region-specific cards or confirm that the store/brand operates internationally or in the recipient’s country.
