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Gift Card Processing

Gift Card Processing
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Taylor Stika
April 11, 2023


Gift card processing is a necessity for any company that sells pre-loaded cards online. In addition, it can be used by standard businesses who want to offer gift cards as a purchasing option for their customers. In any case, both require specialty tools and unique merchants that cater to the specific requirements gift cards have relative to their payment processing capabilities.

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Payment Processing For Gift Card Companies

If you are looking for payment processing services for companies that exclusively sell gift cards, then you’re in the market for a high risk merchant account . The industry of gift card sales has a reputation for having high rates of fraud due to common scams and easy money exchanges that occur on the transaction side.

Nonetheless, reputable gift card services have seen great success buying unwanted cards and selling them at higher prices. This has opened up great opportunities for businesses to capitalize as purchasers and sellers. As such, companies like Zen Payments offer merchant accounts that take into consideration this two way street of arbitrage and growth.

Sell Gift Cards For Your Business

If you have an existing store and want to offer gift cards, then you’ll need to set up your merchant account with a special processing tool. The technology you need is custom-designed to link to your merchant account and make transactions with the cards you create.

To elaborate, gift cards are a unique item when it comes to the customer purchasing experience. They first purchase a code (or physical card), then pay with that information later. This is technically another form of payment that your account needs to recognize.

Benefits Of Offering Gift Cards

Offering gift cards to customers can be an excellent way to grow sales and gain significant brand awareness. If you’re looking for a quick and effective way to bring in more funds while marketing to new and existing customers, then review the below reasons on why we agree that gift cards are the way to go.

  • Purchases Are Made Upfront – When someone buys a gift card, you receive money the same-day, but actual product or services are kept in your inventory. In a way, you’re receiving a payment before anything tangible is ever purchased, and in some cases such as if someone loses a card, it expires, or they decide never to spend it, then you’ve made money from simply offering the payment service.
  • Branding And Marketing – You can really enhance the customer experience to make gift cards an interesting item. If you decide to go with physical cards, the packaging and payment experience can go a long way toward welcoming future purchases.
  • Holiday Shopping – Gift cards can be the perfect holiday gift, because they give recipients the freedom of purchasing what they want, while the gifter selects a thoughtful store or restaurant. You can see huge trends in holiday sales once you offer this item that’s perfect for the casual Christmas present or unique birthday card bonus.
  • Promotions – Perfect for giveaways, mailables, or promotional marketing efforts to engage past customers or recruit new ones. Everyone likes free stuff so if you decide you want to give twenty dollars for the first fifty people to buy your new product, or mail a complimentary gift card to a loyal customer, you’ll definitely get some good reviews when it comes to brand image.

How Does Gift Card Processing Work?

There are a few steps that take place when a company decides to offer gift cards to its customers. Below, we’ll discuss how it works from a transaction level:

  1. Customer Buys The Card – Whether in-store or online a customer first has to get the card in their possession by buying it. It’s at this point that the seller makes their money. Whether or not the recipient ever uses it, the business is already in the green.
  2. Activation – Due to high levels of fraud in the industry physical gift cards don’t come preloaded, and online ones are simply a code and digits that are generated. The card is activated after purchase either by a cashier or by the person that bought it.
  3. Registering The Balance – One key characteristic of gift cards is that they need to have an active way of changing balances. Much like a debit card, the funds are reduced when something is purchased and the payment information is updated within the seller’s accounts.

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Zen Payments


Our merchant service specialists are the best in the business and will work with you from start to finish to get your account approved!

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Taylor Stika is the CEO and Founder of Zen Payments. With a background in the payment processing industry starting in 2015, Taylor has extensive experience in managing and optimizing payment systems. Under his leadership, Zen Payments has grown and developed into a reputable provider of high and low-risk payment.


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