April 22, 2020
In recent years, gift cards have emerged as popular gifting options among consumers in both developed and emerging countries. The NRF 2018 Holiday Spending Survey indicates that six out of every ten consumers like to receive gift cards as a preferred type of gift over clothing, books, and electronics. In 2018, the global gifting industry was estimated to be a $400-billion market, and it is forecasted to grow to $700 billion by 2024. Research suggests that the gifting industry is on an impressive growth path of 10% per year through 2025. With the growing market, gift cards are recognized as one of the important but largely untapped alternative payment methodologies. Other alternative payment methods include digital wallets, credit cards, domestic bank debit cards, bank transfers, invoice or pay-later solutions, and cryptocurrencies.
Gift cards have evolved from physical coupon cards to more secure magstripe, chip-and-PIN-based digital cards, and now, virtual gift cards. Most of the digital gift cards are like debit or credit cards with the feature of unique card numbers and PINs. Fundamentally, these digital gift cards are a subset of the payments market, and growth in this segment is largely driven by the expansion of global e-commerce where digital gift cards are taking a higher share of e-commerce sales worldwide.
In the cross-border payments landscape, gifting remains an untapped & under-address ...