Posted by walterbell 12/21/2025
Why take perfectly good cash and change it to something worse in every way? I cannot understand why so many people enthusiastically go out of their way to buy gift cards. Can you take my cash and convert it to something with the same function but with all kinds of restrictions and gotcha's? Sure no problem....
Not a good reason but it is a real one I have heard.
I feel like that needs a "(currently but not for much longer)" caveat[0] to avoid being wildly disingenuous.
[0] https://www.politico.com/news/2025/11/11/trump-administratio... - "the CFPB [...] anticipates exhausting its currently available funds in early 2026.”
Fascinating footnote.
Could I improve my own privacy posture by just buying myself gift cards, if I can't use cash? Or that's just pushing all the data that the store would get onto the gift card company?
But from Patrick's description, it feels like the situations where it's (usually) not a scam are instances where paying by gift card is an option, not something the "seller" is pushing you hard to do, or even requiring you to do. That seems... okay? I personally would still pay with a credit card, but mayyyybe it's ok for someone who can't get a credit card to go the gift card route. But I would still be wary.
If you're dealing with an unbanked business that cannot take credit/debit cards or checks due to the legal climate around their business or product, then you probably already know what you're getting yourself into. (But still, bit of a red flag if they don't accept cash or even cryptocurrencies, as much as I find those scammy as well.)
> The people of the United States, through their elected representatives and the civil servants who labor on their behalf, intentionally exempt gift cards from the Reg E regime in the interest of facilitating commerce.
This sort of phrasing about things kinda annoys me. Yes, "through their elected representatives...", technically true, but "the people of the United States", no, not really so much. I'm sure most people don't even know about these sorts of differences, and I'm sure the majority of people who are in favor of these sorts of protections on credit/debit cards would want them to apply to gift cards as well.
The problem with this sort of phrasing implies that the American people actively chose this, or even had any choice in the matter. We are limited in the political options that are put before us; we don't get a big menu of policy positions, check off the ones we like, and then a politician appears that matches all our preferences. Some people might -- very reasonably! -- prioritize other policy positions over gift card protection regulation, even if they want the latter as well.
I've got some gift cards sitting here--her health insurance has rewards for doing certain things, there's no way to get them as cash but you can buy gift cards for certain stores. Nothing scammy about it but I'm annoyed Amazon isn't an option because simply dumping them into my Amazon account would be the easiest solution.
>Of course it isn’t. Gift cards are a payments rail, and an enormous business independently of being a payments rail. Hundreds of firms will indeed ask you to pay them on gift cards!
That’s where I stopped reading. The author seems more interested in being contrarian for clicks than in giving practical advice. AARP is right here: being asked to pay by gift card is a major red flag, and unless you know the company personally, it’s time to walk away.
I have never seen a legitimate business asking for payment in gift cards. I've encountered the traditional tradesmen offering discounts for cash, though.
Edit: I think he may actually be talking about businesses accepting payments in their own gift cards, which is so obvious that it's easy to forget. It's not a scam when Apple ask you to pay in Apple gift cards. It's just the only non scam such case.
Them: "But you did it right there."
Me: "And when you know enough about the subject to know why that's a valid exception to the rule, you'll be savvy enough to break the rule. Until then, don't." Chesterton's fence and all.
But I agree with you: the AARP is 100% right to be running PSAs like this. I’d be curious to hear more about how a shadow economy like this would/would not help unbanked people, which he implies but did not describe at all. But it certainly doesn’t change the point that gift cards are an effective vehicle for fraud, and anytime someone asks to pay you (or especially you to pay them) in gift cards… your scam senses should tingle.
At no point did the article claim AARP was in the wrong for running those ads. But had you kept reading you’d maybe have understood that wasn’t the point nor the premise in the first place.
The practical reality is acknowledged at the end of the post.
Even if, technically speaking, using gift cards as a payments instrument is not a scam 100% of the time, anyone but a non-expert should behave as if it's 100%.
I'd pretty much back up AARP on this one. Asking for payment by gift card should in the majority of cases put one on guard.
AARP isn’t telling fibs. It’s giving sound advice.
The only legit use of a gift card is when you’re redeeming that gift card directly with the issuer. No business is going to request or require that you do that.
We don't let terrorists and robbers wander in, why do allow the digital equivalent?