3 mins read Gift Card Brands

Forms of Gift Cards – Physical, Ecode, Open-Loop and Closed-Loop

The holiday season is fast approaching, so it’s time to start thinking of some gift ideas for your loved ones.

Too much work? Just get them a gift card, then. But before you make that buying decision, it is important to know the various forms they come in. This is vital because they each have characteristics that make them preferable over another, but that depends on the receiver.

Keep reading to learn more about the different forms of gift cards you should know before making that purchase.

What Is a Gift Card?

A gift card, also known as a gift voucher, is a prepaid stored-value card that can be used as an alternate payment method. Retailers and banks usually issue gift cards, which are used as an alternative to cash or bank debit card payments.

Gift cards can be used anywhere from retail stores to restaurants, gas stations and just about anywhere they are accepted. 

They are usually loaded with a specific amount of money and come in various denominations such as 50, 100, 200, 500 etc. 

Gift cards work similarly to bank cards, but you cannot use them to withdraw cash from ATMs. 

Forms of Gift Cards

To discuss the various gift card forms, we’ll divide them into two categories. We are categorising them based on how they look – Physical cards and Ecodes, and how they are used- open-loop and closed-loop cards. Let’s get into it.

  • Physical Gift Cards:

Physical gift cards are prepaid plastic debit cards that you can use to make payments in retail outlets and places that accept vouchers in place of cash or a bank debit card. A physical gift card usually has the branding of the retailer on it. These cards are bought directly from the store and are typically rectangular, similar to a credit/debit card.

A physical gift card can be redeemed online or in a physical retail store, and to do this, you have to scratch the back of the card to reveal the code. To redeem in a physical store, you must hand the cashier this card at the checkout point. They will then input the code and deduct the amount of money for the things you purchased from the card. 

To redeem it online, you must manually input the code or take a picture of the card and upload it to the checkout page.

The physical gift card usually has a higher rate than the Ecode, and you can get even higher resale rates if you still have your receipt.

  • Ecodes or E-Gift Cards:

Ecodes, also known as E-gift cards, are electronic gift cards. When purchased, it is sent to your email address provided. Instead of having a physical copy of this gift card, it is on your device. So, when you wish to redeem it, you must search for it on your device to provide the information. 

They work just like regular physical gift cards, but they are easier to carry around and safer because they can be on your mobile device, so they cannot be stolen easily. Well, unless someone steals your mobile phone, oops.

To redeem an e-gift card in a physical store, you must show a copy of the voucher. It is helpful to save the e-gift card number somewhere, like the notes application on your phone. Other options are to take a screenshot or open up the email and show it to the cashier at the checkout point.

On the other hand, redeeming it online entails simply inputting the card number and PIN on the online checkout page.

  • Open-Loop Gift Cards:

An open-loop card, otherwise known as a multipurpose card, is a gift card that can be used anywhere it is accepted. When you think of open-loop cards, you might think of credit and debit cards, and you are not wrong; they are open-loop cards. But there are also open-loop gift cards.

Most people are familiar with gift cards like Amazon and Sephora, which you can only use in Amazon and Sephora stores. But there is also a type of gift card that you can use in multiple stores and outlets; these are open-loop cards.’

Examples of open-loop cards are Visa and American Express gift cards.

  • Closed-Loop Gift Cards:

Unlike open-loop cards, closed-loop gift cards are gift cards that you can only use in a particular store or outlet. With an open-loop card, you can purchase a Visa card and use it anywhere Visa cards are accepted, but with a closed-loop card, you can buy a Steam gift card and use it in a Sephora store. 

Examples of closed-loop cards are Sephora, Amazon, Steam, eBay etc. 


We split the forms of gift cards into two categories – how they look and how they work. It is important to note that physical and Ecodes can either be closed-loop or open-loop and vice versa.

There are hundreds of gift cards out there, so it is vital that you know the different forms they come in to make a suitable purchase choice. 


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