Understanding Gift Certificates

Updated April 7, 2013 9:49 AM

What is the difference between gift certificates and gift cards? Basically gift cards can be swiped at computer registers for processing during checkout, and carry a pre-determined value. With a gift certificate, the purchaser asks the cashier to enter a price value, which becomes the recipient's account in the system database.

Gift certificates are popular devices employers award employees, or give to show appreciation for some achievement. Understanding it is easier and more cost-effective to retain a high-performing employee than spend time and money hiring a new one; the smart employer makes corporate gift-giving part of their retention strategy.

The corporate gift certificate is a win-win for everyone. The employer can adapt their gift-giving programs to the segmented employee workforce, according to lifestyle preferences. And employees can feel valued for their unique contributions to the company.

Gift certificates can perform a variety of functions for the employer. It can signify an outstanding performance, hours of overtime, goals exceeded, or highest sales figures. It can be used as a holiday bonus, employee-of-the-month award, and more.

Gift certificates have a time limit of normally a year and a half before they expire. They may only be used at participating merchant stores and cannot be converted into cash, or redeemed for a cash refund. Unused balances on a gift certificate will not extend beyond the original date of expiration.

Although paper gift certificates have long been in use, the e-gift certificate is a newcomer to gift-incentive programs. Its benefit is speedy, one-business day delivery.

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Understanding Gift Certificates

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