Why digital gift cards are becoming the new normal and why you should consider them for your business

Traditional, usually plastic, gift cards have long been a popular choice for gift-givers, but digital gift cards are gaining traction as a more convenient and innovative alternative.

Unlike their physical counterparts, digital gift cards are delivered to recipients electronically via text message, email, or mobile application. This digital format offers unmatched flexibility and convenience for both the sender and the recipient. Digital gift cards can be instantly purchased and delivered, then redeemed by a recipient in mere minutes; not to mention they do away with plastic making them the more sustainable choice.

Several other factors contribute to the increasing popularity of digital gift cards:

Digital gift cards leverage the security features of mobile wallets, including biometrics like face recognition, fingerprint, or iris scan, ensuring legitimacy of the payment. Tokenization enables safe storage of payment cards in a digital wallet, facilitating online or contactless payments without exposing sensitive information. Additionally, digital cards can be easily tracked and cancelled if needed.

Delivery options
Digital gift cards can be sent directly to recipients via text message, making them ideal for instant gifting, bulk issuance, last-minute rewards, and incentives. No physical delivery also means no associated delivery costs.

Storage and organisation
Digital gift cards can be stored in mobile wallets, or dedicated gift card apps, making them easily accessible and eliminating the need to carry multiple physical cards.

Digital gift cards can be used for various purposes such as online shopping, in-store purchases, bill payments, or as payment methods for digital platforms and subscriptions, providing recipients with a wide range of choices.

Real-time balance tracking
Digital gift cards often include features that allow recipients to check their remaining balance in real-time, ensuring they can make informed purchasing decisions.


Ways digital gift cards and digital payment solutions can be used for business

Beyond gift-giving alone, digital gift cards offer businesses a multitude of other uses, with rewards and incentives programs being two significant options. In these cases, the reward or incentive is sent in the form of a digital gift card to a recipient for them to redeem – either freely or within a time and/or location you set.

In 2024, rewards programs emerge as one of the most influential factors in customer experience strategy. Forbes magazine confirms, “Rewards programs are not mere transactional gimmicks but foundational elements that encourage repeat business.” Businesses that offer tangible rewards and incentives – whether to staff or customers or both – are capitalising on the potential of turning people into enthusiastic brand advocates.

But there are even more ways digital cards prove better for business. They’re also more effective for:

  • Managing payout claims
  • Resolving customer complaints
  • Encouraging brand switching
  • Motivating your team
  • Rewarding hard workers

The benefits of using digital gift cards for business

The above examples demonstrate the diverse applications of digital gift cards in business, but now let’s explore the advantages that extend beyond convenience, flexibility, cost-saving and security:

Data insights
Digital gift cards provide valuable data insights for businesses. By tracking customer transactions and usage patterns, companies can gather valuable information that can be used for targeted marketing campaigns and personalised promotions. This data-driven approach enhances customer engagement and loyalty by offering tailored experiences based on individual preferences and behaviours.

Increased Customer Engagement
Digital gift cards can be seamlessly integrated with loyalty programs, referral systems, and special promotions. This integration encourages customers to engage further with the company, driving repeat purchases, enhancing customer retention, and fostering word-of-mouth marketing. By incentivising continued interaction, businesses can strengthen relationships with customers and cultivate brand advocates.

Enhanced Branding Opportunities
Digital gift cards offer ample opportunities for branding and customisation. Companies can fully customise the digital card’s creative elements, personalise messaging, and even incorporate unique features within their application or develop their own branded app. This level of customisation reinforces brand visibility and creates a cohesive brand experience for customers, thereby strengthening brand loyalty and recognition.

Changing Customer Behaviour
Rewards and incentives play a vital role in driving behavioural changes, as they offer immediate benefits, create a sense of exclusivity, and introduce consumers to new opportunities. By understanding the motivations behind consumer behaviour and leveraging rewards effectively, businesses can adapt to changing preferences and build stronger relationships with their customers.


In summary, digital gift cards serve as a win-win tool for businesses aiming to attract new customers and enhance customer retention. They offer a convenient and flexible way to engage with customers, providing valuable incentives while also gathering insightful data to improve marketing strategies. Additionally, digital gift cards can be seamlessly integrated into loyalty programs and promotional campaigns, further amplifying their effectiveness in driving customer satisfaction and loyalty. Overall, businesses leveraging digital gift cards can enjoy the benefits of increased customer acquisition and retention, ultimately leading to sustained growth and success.