In a more globalized world, sending money across borders is more prevalent than ever. Gift cards for international transfers are becoming an increasingly popular option. Whether paying family members at home, covering services, or gifting a friend abroad, international money transfers are an everyday occurrence for millions.
Individuals have used wire transfers, bank transfers, and remittance companies such as Western Union or PayPal to send money abroad for decades. But now, a new trend is starting—using gift cards as a means of money transfer across borders. Gift cards, previously the domain of holiday presents or birthday gifts, are now being used as a convenient, flexible, and in some cases cost-saving alternative to conventional transfer mechanisms.
This article examines how gift cards operate for international transfers, their advantages, possible drawbacks, and how they compare to other options. By the end of it, you will better understand whether gift cards are an appropriate solution for your international transfer requirements.
How Gift Cards Work for International Transfers
Gift cards are prepaid cards that can be loaded with a specific value and redeemed later for goods, services, or in some cases, cash. For international transfers, gift cards can be used in a few different ways:
Direct Sending: The sender purchases a gift card—usually a prepaid Visa, Mastercard, or a specific retailer’s card like Amazon or Flipkart—and shares the card code or number with the recipient abroad via email, messaging apps, or phone.
Gift Card Exchanges: Recipients can sometimes convert these gift cards into local currency through online marketplaces or third-party exchange platforms, which facilitate the conversion of cards into usable cash.
Online Purchases: The recipient can use the gift card to shop online, provided the merchant accepts the card in their country or ships internationally.
Types of Gift Cards for International Transfers
- Prepaid Visa or Mastercard Gift Cards: These are accepted globally wherever Visa or Mastercard is supported.
- Retailer-Specific Gift Cards: These are useful only if the recipient can access that retailer’s services (e.g., Amazon, Walmart, Flipkart).
- Digital Gift Cards: Sent instantly via email, offering quick delivery but limited usage flexibility.
The Process
Sending a gift card internationally typically involves:
- Selecting a card and loading it with funds.
- Ensuring it’s valid for international use.
- Emailing or texting the card code to the recipient.
- Verifying that the recipient can redeem or use the card in their region.
Pros of Using Gift Cards for International Transfers
1. Low or Zero Transfer Fees
One of the most compelling reasons to use gift cards is the potential savings on fees. Traditional money transfer services often charge between 3% and 10% in service fees and currency conversion charges. In contrast, many gift cards come with no additional transfer fees (beyond the initial purchase fee, which is often nominal).
Example: Sending $100 via Western Union could incur up to $10 in fees, while a $100 Amazon gift card typically only costs $100—no extra charges.
2. Speed and Convenience
Gift cards can be purchased and sent within minutes, making them ideal for urgent needs. Visiting a physical location or going through a complex bank process is unnecessary. Digital gift cards, in particular, are available 24/7 and can be sent instantly via email.
3. Accessibility for the Unbanked
According to the World Bank, nearly 1.4 billion adults remain unbanked. Gift cards offer an accessible alternative for recipients without bank accounts. Since they don’t require a bank account to receive or use, they are ideal for people in underbanked regions.
4. Increased Security
Sharing sensitive banking information over international platforms can be risky. Gift cards reduce this risk—the sender doesn’t need the recipient’s bank account number or personal information. This makes them a safer alternative, particularly for first-time transactions or in less secure regions.
5. Flexibility of Use
Recipients can use gift cards in multiple ways:
- Online shopping for essentials or gifts.
- Exchanging the card for local currency (via platforms like Paxful or CardCash).
- It is used by international retailers that ship worldwide.
Some prepaid cards even support multiple currencies, offering more flexibility.
Read related blogs: Why Gift Cards are Revolutionizing International Money Transfers
Cons of Using Gift Cards for International Transfers
1. Limited Redemption Options
Not all gift cards are created equal. A significant limitation is regional restrictions. For example, a Flipkart card may only be redeemable in India, and an Amazon.com gift card may not work on Amazon .
The funds may go to waste if the recipient lives in a region where the card isn’t accepted.
2. Fraud Risks and Scams
Because gift cards are difficult to trace once used, they’re a prime target for scammers. There’s a risk that the recipient never receives the code or that someone intercepts it. Additionally, fraudulent card resellers on peer-to-peer platforms can sell invalid or already-used cards.
Gift card scams are so widespread that some governments warn against sending gift cards as payments, especially in transactions involving strangers.
3. Currency Conversion and Exchange Rates
Transaction fees may apply if the card is denominated in a different currency than the recipient’s local currency. For example, a USD gift card in India might be subject to foreign exchange fees, and the actual value received may be lower than intended.
Some gift card platforms do not offer transparent exchange rates, leading to hidden costs.
4. Transaction Limits
Most gift cards have a maximum load limit—often $500 or $1,000. If you’re looking to send larger sums, this method may not be viable or require multiple transactions, which can be inefficient and time-consuming.
5. Lack of Cash Access
Sometimes, gift cards cannot be easily converted into physical cash. This can be a significant drawback for recipients in countries where digital commerce is limited or where physical cash is more useful.
While some platforms allow trading cards for cash, this often comes at a discounted value (e.g., a $100 card might fetch $80), reducing the adequate amount transferred.
Read related blogs: The Benefits of Using Gift Cards to Send Money Abroad
How Gift Cards Compare to Traditional Money Transfer Methods
| Method | Fees | Speed | Accessibility | Security | Flexibility |
| Gift Cards | Low to none | Instant (digital) | High (no bank needed) | High (no banking info) | Medium (depends on card) |
| Bank Transfers | Medium to high | 1–5 business days | Low (bank required) | High | High |
| MoneyGram/Western Union | High | Fast (same day) | High (pickup option) | Medium | High |
| Digital Wallets (PayPal, Venmo) | Medium | Fast | Medium (account required) | Medium | Medium |
Gift cards excel in speed and accessibility but lag behind in cash usability and global acceptance.
Best Practices for Safe and Effective Gift Card Transfers
To ensure a secure and practical experience:
- Use reputable platforms: Buy gift cards only from official websites or certified sellers.
- Confirm usability: Ensure the recipient can redeem the card in their country and on a platform they can access.
- Avoid sending to strangers: Only send gift cards to trusted individuals.
- Verify codes securely: Use encrypted messaging apps or email with two-factor authentication when sharing gift card information.
- Keep receipts: Maintain a copy of the purchase receipt in case there are issues with redemption.
Conclusion
Gift cards offer a unique and modern way to send money internationally. Their speed, low fees, and accessibility make them appealing, especially for small amounts, unbanked recipients, or quick gifting. However, they come with notable drawbacks like limited usability, lack of cash access, and potential for fraud.
Beem’s Send Money service delivers rapid, bank-free transfers ideal for urgent support or everyday use. Its user-focused platform ensures convenience without sacrificing speed. Thanks to Beem’s innovative Send Now, Pay Later™ feature, users gain dependable access to instant money transfers anytime, anywhere.
In summary:
- Use gift cards for low-value, quick, and casual transfers, particularly to recipients who can easily use them.
- For larger amounts, cash needs, or where guaranteed usability is critical, opt for traditional methods like bank transfers or remittance services.
Understanding the pros and cons lets you decide whether gift cards are the right choice for your international transfer needs.
FAQs
Can I use any gift card for international transfers?
No. Only certain cards (like prepaid Visa or Mastercard) offer global usability, and retailer-specific cards may have regional restrictions.
Are there any fees associated with using gift cards to send money abroad?
Most gift cards have minimal or no fees, but third-party exchange platforms may charge conversion or transaction fees.
What happens if the recipient can’t redeem the gift card in their country?
The funds may become inaccessible. It’s crucial to check redemption policies before sending.
Is sending large sums of money using gift cards safe?
Gift cards have load limits and can be risky for large transfers due to fraud and loss potential.
Can I withdraw cash from a gift card when sending money internationally?
Typically no. Most gift cards cannot be used at ATMs unless they are prepaid debit cards with cash access features.
