Gift cards have become a popular gift item over the years. They provide the recipient with the flexibility to purchase whatever they want within the issuing merchant’s offerings. But sometimes, after the holidays or a special occasion you’re left with a gift card that you don’t really need or want.
If you’d rather use that money to pay off your credit card debt, what can you do? Let’s find out if you can use gift cards to pay your credit card bills.
The Short Answer
The short answer is no, you can’t use a gift card to pay a credit card bill directly. You can’t just enter a gift card number and PIN to pay with a credit card company online or over the phone.
However, that doesn’t mean it’s impossible to use the funds on a gift card to pay down your credit card balance. It just requires a few extra steps.
Why Credit Cards Don’t Accept Gift Cards
Most credit card companies only allow you to make payments in a few specific ways, like:
- Checks
- Money orders
- Bank account transfers
- Wires
- Online account funding with a bank account
- Payroll deductions
They do not have the capability to process gift card numbers as a form of payment. Credit card processing and gift card processing work very differently behind the scenes.
When you use a gift card to make a purchase, the merchant has a system that verifies the card is active, deducts the amount, and approves the transaction.
A credit card company can’t process payments through all of the different gift card systems, though. The technology infrastructure just doesn’t exist.
How to Use Gift Cards to Pay Credit Cards
There are still things you can do if you can’t use a gift card to pay your credit card bill directly. There are several ways to turn the money on a gift card into cash that you can use to pay for something:
Sell the Gift Card
There are several websites, such as CardCash, GiftCardGranny, and CardPool, that will buy gift cards for a percentage of the face value. This converts the gift card into cash that you can then use to pay your credit card.
The exact amount will depend on the website, demand for that merchant’s gift cards, and how much money is left on the card. But you can typically get 70-90% of the value.
Exchange it for a Prepaid Visa Card
Some stores will allow you to exchange a gift card for a prepaid Visa or Mastercard. This acts like a debit card that you can then use to buy a money order or make an online payment to your credit card.
Just be aware that there is usually a purchase or exchange fee involved, so you’ll get slightly less value than the original gift card.
Use it to Buy a Money Order
If the gift card is for a retailer that sells money orders, like the post office or Walmart, you may be able to directly exchange the gift card for a money order made out to your credit card company.
Most credit card companies accept money orders by mail as a form of payment. Just make sure to follow the proper procedures for mailing money orders.
Add it to Your PayPal or Venmo Account
If you link the gift card to your PayPal or Venmo account, you can transfer the funds to your bank account. From there, you can use the money to make an online payment to your credit card.
However, take note of any fees involved for transferring from PayPal or Venmo to your bank. Make sure it’s still worth it after deducting those.
Buy Something to Resell
If there are no good options for exchanging the gift card directly, another approach is to use it to buy an item you can then resell for cash.
For example, buy a popular electronics item or piece of jewelry with the gift card, then sell it on eBay, Craigslist, or Facebook Marketplace. Use the profits to pay down your credit card.
Tips for Using Gift Cards to Pay Credit Cards
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Check the gift card balance first. Make sure there’s enough on the card to make it worthwhile after any exchange fees.
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Compare exchange sites to get the best rate. Rates can vary significantly between sites.
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Beware expired gift cards. If it’s an older gift card, make sure it hasn’t expired and the funds are still available.
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Understand any fees involved. There are often fees for exchanges, using prepaid cards, etc. Factor these in.
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Keep the exchange value. Don’t exchange a $100 gift card for $70 if you don’t need $70 right now. Wait until you’re ready to use the full value.
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Pay down highest interest cards first. If exchanging multiple gift cards, use the cash to pay down your most expensive credit card debt.
Alternatives to Paying Credit Cards
If you receive a gift card you don’t want, here are a few other options besides paying down credit card debt:
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Regift it – Give it to someone else on your gift list if you won’t use it.
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Redeem for goods to sell – Apply the credit and sell the items.
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Donate it – Give it to a charity organization that can use it.
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Use it on budgeted purchases – Buy groceries, gas, or other budgeted items.
The Bottom Line
Unfortunately, credit card companies do not directly accept gift cards as a form of payment on accounts. But that doesn’t mean gift cards are useless if you want to pay down debt. With a few extra steps, you can convert the gift cards into cash or money orders that you can then use to pay your credit card balance. Just be aware of any exchange fees involved to make sure it’s worth it.
Withdraw the balance as cash
Some open-loop gift cards let you withdraw the balance as cash at ATMs. You can then use that cash to pay off your credit cards. Here’s how:
- Check the card: See if your card allows cash withdrawals. The gift card website should have that information.
- Find your PIN: It may be located on the card. If not, you can look for it on the card’s website or call the customer service number.
- Visit an ATM: Withdraw cash using your card and PIN, just like a debit card.
Remember that there are usually fees for ATM withdrawals from gift cards, so you may not be able to get the full amount off the gift card.
Some stores, including Walmart, allow you to purchase money orders using your open-loop gift cards. Once you have the money order, deposit it into your bank account or cash it at a check-cashing service. This process effectively converts your gift card balance into usable cash.
Buy items and resell them
If all else fails, you can always purchase items from the store and try to resell them on platforms like eBay, OfferUp, or Facebook Marketplace. If you get the item on sale, you can resell it for a profit. Do some research and try to pick an item that is in demand and easy to resell. This method does require a lot more effort to get actual cash from the gift card, and you risk being stuck with an item you don’t want, but it’s worth a shot.
Convert a Visa Gift Card into Cash INSTANTLY
FAQ
Can I use a Visa gift card to pay down a credit card?
You can’t directly use gift cards to pay off credit card balances. Even if it’s a general gift card like Visa or Mastercard that look like debit cards, credit card companies typically only accept payments through bank accounts, checks, or by using a balance transfer credit card. Jan 16, 2025.
How do I transfer money from a gift card to my bank account?
It’s generally not possible to directly transfer money from a gift card to a bank account, as gift cards are typically designed for point-of-sale purchases.
Can I pay a bill with a Visa gift card?
Yes, in most cases, you can pay bills with a Visa gift card, as they can be used anywhere Visa debit cards are accepted.