What does gift card mean?
Gift cards are those cards being issued by retailers/companies which have a certain amount restriction on them. For example a gift card with a value of $250, can be used by the owner to buy merchandise worth of $250 only. Gift cards are a very popular way of replacing the traditional gifts, because the owner can select at his/own discretion the item he/she wishes for. Now, there is a difference between open loop gift cards and closed loop gift cards, where the first category is that type of cards which has restriction as to the store chain.
For example, one may receive a gift card which can be used only at one specific department store (B&K store, Kaufmann’s and so on). On the other hand, the open loop gift cards give that legerity of being able to make purchases almost in any place of wish. The difference between the two types however is that an open loop card does have an expiration date and some it also charges some extra fees. Open-loop cards are most of the times are issued by banking institutions (Visa).