Why Does Target Charge For Gift Cards

When purchasing a gift card, you expect to only pay for the gift card’s value, but that isn’t always how gift cards work. If you see a sudden charge for a gift card, you’ll start to wonder why Target charges for gift cards?

Target will charge for gift cards on top of the amount for a gift card when you get a gift card as part of a promotion. Most gift cards – like those for Visa or Mastercard – will also carry an activation fee that might surprise you. 

Gift cards are a wonderful way to get “free” stuff, but there are still additional fees associated with gift cards. Keep on reading to become a gift card expert!

Reasons Why Target Charges For Gift Cards

There are a few specific reasons why Target charges for gift cards, though there may be other one-off instances of additional charges on gift cards.

The Gift Card Was Part Of A Promotion

You will be charged for gift cards if your gift card is part of a Target promotion.

The easiest way to explain this is with a simple example.

Let’s say that Target is running a promotion where you will get a $10 gift card if you buy $35 worth of products online.

You will not get a $10 gift card with your purchase like you will in-store.

Instead, your products will be discounted to $25, and you will be “charged” a $10 gift card. Although you are not paying for the gift card, it may seem like it when you are making a purchase.

This may seem confusing, but it is a way that the store can avoid losing out on money if a product is returned.

The Gift Card Had A Service Fee

Gift cards from certain companies will have a service fee.

Let’s say that you stop at Target to pick up a Visa or Mastercard gift card for a friend or family member. That way, they’ll be able to use it anywhere they want!

The gift card usually comes with an additional service fee that can vary based on the company and gift card amount.

In the past, Visa gift cards charged a $4.95 service fee for card activation. You would pay $104.95 to purchase a $100 gift card. The person who receives the gift card does not have to pay any fees.

These days, the fees are often tied to the gift card amount, so you can pay a service fee anywhere from $2.95 to $6.95.

Ways To Avoid Getting Charged For Gift Cards

If you’re stingy and don’t want to pay for gift cards, there are a few ways to get around those fees.

Give Cash

The easiest way to avoid service fees on gift cards is to give cash instead.

We can all agree that the additional service fee on gift cards is a pain, but it can be avoided.

Giving cash will probably require you to take a trip to your bank, but $100 in cash is the same as a $100 Visa gift card, even though it may seem less convenient for both people involved.

The person you give the money to will still get the full amount of the gift, and you won’t have to pay an additional few dollars. 

Save it for the card is all I can say!

Only Purchase Store Gift Cards

Almost every store gift card does not have a service fee to pay on top of it.

If you still want to avoid service fees but don’t want to go to the bank, you can purchase store gift cards that do not have a service fee.

Getting a Target gift card at Target acts like store credit, so you aren’t expected to pay a service fee to activate the gift card.

You’ll avoid the service fee, but you’ll also limit the person receiving the card to shopping in the store it is for. The person you give the gift card to may do all their shopping at the store, so they may not know the difference! 

There are trade-offs with this option, but it will save you a few dollars when purchasing the gift card.

Do Not Participate In Promotional Sales

Do not purchase items for free gift cards during promotional sales.

If you do not like how Target runs its promotional sales – even if you may love the idea of a free gift card – then the best advice I can give is not to participate.

In addition to not having to deal with the confusion of the free-but-not-free gift card, you may also have:

  • Experienced trouble with promotion in the past
  • Been unable to spend the minimum amount on products
  • Not shopped at Target enough to make the promotion worth it

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