How Visa Gift Cards Work

by Jackie Lohrey ; Updated July 27, 2017
Young woman on cell phone gives shopkeeper a gift card.

A Visa gift card is a non-reloadable, prepaid debit card. Once it's activated, the card works just like cash. The cardholder can use it to shop or make a one-time bill payment anywhere that accepts Visa for as long as a balance remains. The gift cards are available at banks and retail stores.

Loading and Activating a Card

The issuer specifies the minimum and maximum load values of the card. The minimum is usually $25, while maximum amounts generally range from $500 to $750. In addition, the issuer determines whether the card activates automatically upon making a purchase or whether the recipient must first activate the card online or over the telephone. Visa recommends the buyer provide the recipient with the card's terms and conditions paperwork, which includes activation and usage instructions.

Using the Card

According to Visa, most gift cards do not come with a personal identification number. For in-person transactions using cards that do not come with a PIN, choose the credit card option and sign a purchase receipt. If the card does have a PIN, use the debit option and enter the PIN you selected or that came with the card. For online transactions, enter the card number and three-digit security code just as with a credit card. However, no matter where or how you use the card, Visa immediately deducts the amount from the available balance.

Expiration Dates

Although most cards have an expiration date extending out between five and seven years, the funds never expire. Despite this, a card with a very small balance may be declined at check-out time even if you inform the cashier in advance that you intend to use two forms of payment. If this happens, Visa recommends contacting the issuer for further instructions. If the expiration date printed on the front of the card passes, you can request a new card from the original issuer. However, an issuer has the option to charge a monthly fee if a card remains inactive for a certain period. For example, TD bank charges a monthly fee of $2.50 after 12 months of inactivity.

Gift Card Limitations

Gift cards can't be used to withdraw cash at an ATM machine or to get cash back at a checkout register. In addition, issuers do not allow cards to be used on Internet gambling sites or to set up recurring bill payments. Although you can use one at a gas station, paying at the pump instead of inside can result in a $100 authorization hold that can take from three to seven days to remove.

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About the Author

Based in Green Bay, Wisc., Jackie Lohrey has been writing professionally since 2009. In addition to writing web content and training manuals for small business clients and nonprofit organizations, including ERA Realtors and the Bay Area Humane Society, Lohrey also works as a finance data analyst for a global business outsourcing company.

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