Gift card arbitrage is the process of buying and selling gift cards. I first stumbled across this when I was trying to meet one of my credit card minimum spending bonuses.
As one might figure, you can obviously buy gift cards from the retailer themselves. For instance, I can go to Starbucks and buy a Starbucks gift card. That’s kind of a given.
Some stores sell gift cards to other stores/retailers. For instance, the local grocery store has a display much like the picture above with hundreds of different gift cards for sale. This is great if you have a category bonus at a grocery store or if you’re trying to meet a minimum spending bonus. However, this isn’t where you’ll find gift card deals. These stores usually sell the gift cards at face value. Occasionally, some stores will run promos on certain cards, but they usually only save you a few bucks.
Sourcing Gift Cards
So where do you find deals on gift cards? Here are some a few of my favorites:
- OfficeMax/Office Depot
These stores will often sell gift cards are a discount. eBay and Target also allow you to pay for gift cards using gift cards, which can mean even more profit.
One of my favorite websites that frequently posts gift card deals is the blog: Doctor of Credit.
Reselling Gift Cards
There are tons of sites that allow you to sell “unwanted” gift cards. It is kind of hard to keep track of them all, but there are two different websites that can aggregate the data for you. You can use both of these sites to help determine how much a gift card will resell for: GiftCardWiki and Gift Card Granny
Both are super helpful to show which gift card reseller will give you the most money for your gift card. They will link you to the reseller where you can input whatever information they require to sell your gift card to them.
Some gift card reselling sites require you to mail the cards to them. Others will take e-codes. Others will take e-codes, but it lowers the payback amount. After this is done, the gift card company will send you a check. The whole process can take up to 3 weeks so you have to be able to float that money.
Side note: Be careful if you ever buy a gift card from one of these gift card reseller. Use it as quickly as possible. Sometimes the cards that they list for sale are stolen or part of return fraud. If this happens, it can be a pain to deal with. #youhavebeenwarned
Using Gift Cards
Of course you don’t have to resell your gift cards. You can also use them for personal expenses, but that’s not arbitrage.
Gift card arbitrage is a lucrative way to earn points and profit a little bit on the side. Here is a great example of how I made a profit while earning points: eBay sale on Sears GCs.
However, it is important to look at gift card arbitrage as a side business. It takes time, research and money. You also want to keep careful documentation of everything. In the end, it can definitely pay off and be a great way to generate points.