One of the most frequently asked questions that we receive from those who are implementing a gift card program is; “How do I load the gift cards with dollars?”
The truth is that gift cards are not loaded with dollars; the gift card only REPRESENTS dollars loaded in a back office system.
Gift cards are manufactured in a two-step process; first the plastic is printed and finished with the designs and logos that are common to all of the cards. Then a unique number is assigned to each card and applied to a magnetic stripe or barcode. This assigned number is what tells the back end system what card is being presented.
Card numbers are assigned in the form of an encoded magnetic stripe, a bar code, or a human readable number printed on the cards. When the gift cards reach the merchant, each card is unique by way of this number and is ready to be assigned a dollar value in the merchants system.
This assignment or “activation” takes place at the point of sale (POS). The unique card number is read by the POS system through a mag stripe swipe, a bar code scan or a key stroked number. The dollar amount that is to be assigned to the card is entered, and the two numbers (the card number and the dollar amount) are stored in the POS database.
The card itself is never physically changed by this activation process. When a customer redeems a portion of those assigned dollars, the card number is again read via a swipe, scan, or key entry, the database is accessed and the value is determined. The merchant will then update the value remaining on the card by subtracting the desired transaction amount from the amount remaining in the database.
You can think of a gift card as a “key” that unlocks a database allowing the merchant to see how many dollars are assigned to that card.
Do you want to start your own gift card program? Give us a call, we would love to help you out!