Gift Card Platforms for Small Businesses
Gift cards bring in cash before you deliver anything, introduce new customers through people who already love you and make an easy last-minute present. Running them well takes more than printing a voucher, though. This guide compares three gift card platforms small businesses often use, explains the accounting and legal basics and gives you a simple plan to launch or tidy up your gift card program.
Key takeaways
- Square Gift Cards and Toast connect gift cards to their own point of sale systems; GiftUp! focuses on selling digital gift cards through your website.
- Gift card money is not yet earned revenue. It sits as a liability until the card is redeemed, so track it carefully.
- Rules on expiry dates, fees and unclaimed balances vary by country and US state, so check them before you set terms.
- Promote gift cards around gifting moments such as graduations and Father's Day, not only in December.
It is late May, and the next few weeks are full of gifting occasions: graduation season runs from May into June, Father's Day falls on 20 June in both the US and UK, and summer birthdays, teacher thank-yous and weddings keep coming. Many of those gift buyers are short on time and ideas. A gift card that is easy to buy online in two minutes catches exactly that moment.
This guide is not a ranking. Each platform suits a different setup, and features, fees and availability vary by country and change often. Check current features, pricing and privacy policies directly with each provider.
Why gift cards are worth getting right
A well-run gift card program does several jobs at once:
- Cash up front. You receive the money when the card is sold, which can help in slower months.
- New customers. Recipients often visit for the first time because someone else recommended you with real money.
- Extra spend. Many recipients spend beyond the card value when they visit.
- Easy gifting. Buyers who cannot choose a product can choose your business instead.
A badly run program, on the other hand, causes headaches: paper vouchers that are easy to copy, balances nobody can check, confused staff at the till and accounts that treat gift card sales as income too early.
Physical, digital or both?
Before comparing platforms, decide which formats you want to offer.
Physical cards
Plastic or printed cards work well for in-store buyers, gift baskets and counter displays. They look like a real present. You need card stock, a way to activate them at the till and a secure way to check balances.
Digital gift cards (eGift cards)
Digital cards are sold online and delivered by email or text, often with a personal message and a scheduled delivery date. They are ideal for last-minute buyers and for people sending a gift to someone in another city. They also let you sell around the clock without staff.
Most small businesses do best with both: a digital option on the website for convenience and a physical card for shoppers who want something to hand over.
Pro tip
Put a "Buy a gift card" button in your website header, not hidden in the footer. Add the same link to your Google Business Profile and social bios. Gift buyers in a hurry will not go looking for it.
The three platforms at a glance
These summaries describe how each tool is generally positioned, not full feature lists.
Square Gift Cards
Square Gift Cards works with the Square point of sale, so cards sold online or in store can usually be redeemed at the till and tracked in the same system. It is often a natural choice for cafes, salons, shops and other businesses already using Square. Check how physical cards are ordered, how eGift cards are delivered and which features depend on your plan.
GiftUp!
GiftUp! focuses on selling digital gift cards and vouchers through your own website, often by embedding a checkout on an existing page. It can suit businesses selling services and experiences, such as spas, studios, tour operators and restaurants, that want flexible gift options without changing their POS. Ask how redemption works at your till and what fees apply to each sale.
Toast
Toast offers gift cards as part of its restaurant point of sale. Cards can generally be sold and redeemed across Toast's in-store and online channels, which keeps balances and reporting in one place. It makes the most sense for restaurants already using, or moving to, Toast.
Common mistake
Using handwritten paper vouchers with no unique code or record. They are easy to copy, hard to check and impossible to reconcile at month end. Even a simple system with unique codes and a balance lookup protects you and your customers.
What to compare before you choose
POS fit and redemption
The most important question is how a card gets redeemed. If a server or cashier has to switch apps, type long codes or call the manager, the experience suffers. Ask each provider to show the redemption flow at your actual till.
Costs
Check setup costs, any monthly fees, per-sale fees, payment processing and the cost of physical card stock. Estimate totals using your own made-up sales targets for a quiet month and a gifting peak.
Digital buying experience
Try buying a card on your phone. Can the buyer add a message, choose an amount, schedule delivery and pay in under two minutes? Can the recipient check their balance easily?
Reporting and liability tracking
You need to see cards sold, cards redeemed and outstanding balances at any time. That report feeds straight into your bookkeeping.
Promotions and security
Look for options such as bonus cards, custom designs, fraud protection, purchase limits and the ability to cancel or reissue a lost card.
Customer data and consent
Gift card buyers and recipients are valuable contacts, but only market to them with the right permission. In the UK and EU, PECR and GDPR consent rules apply to marketing emails. In the US, CAN-SPAM requires a clear unsubscribe option and a valid physical postal address in commercial emails. Check that the checkout asks for marketing consent separately from the purchase.
Accounting and legal basics
Gift cards feel like sales, but your books should treat them differently.
- Deferred revenue. Money received for goods or services not yet delivered is deferred revenue. It sits as a liability until the card is redeemed, then becomes revenue.
- Unredeemed balances. Some cards are never fully used. How and when you can recognize that money, and whether some US states require unclaimed balances to be reported, depends on local rules. Ask your accountant.
- Sales tax and VAT. Tax treatment of gift cards can differ from normal sales and varies by country. Check the official guidance for where you trade.
- Expiry dates and fees. Many places have consumer rules on gift card expiry dates, inactivity fees and how terms must be shown. Check current rules before printing an expiry date on anything.
This article is general information, not legal, tax or accounting advice. A qualified accountant or adviser can confirm how gift cards should be treated in your business.
A gift card tracker template
Even if your platform reports this, a monthly summary helps you and your bookkeeper. All amounts below are made-up examples.
| Month | Cards sold (value, example) | Cards redeemed (value, example) | Outstanding balance at month end (example) | Channel mix | Notes |
|---|---|---|---|---|---|
| May | $1,800 | $900 | $4,100 | 70% digital, 30% in store | Graduation push |
| June | $2,600 | $1,400 | $5,300 | 65% digital, 35% in store | Father's Day bundle |
| July | $700 | $1,900 | $4,100 | 80% digital, 20% in store | Summer redemptions |
Hypothetical example
Imagine Aisha, who runs a small day spa. She has been selling paper vouchers written by hand, and twice this year a customer turned up with a voucher nobody could find a record of. She moves to a digital gift card tool, adds a header button to her website and creates a "Treat Dad" gift card design for Father's Day. Staff redeem cards at the front desk with a quick code lookup, and each month she sends the outstanding balance report to her bookkeeper. Her made-up goal: sell 40 digital cards before 20 June.
How to launch or relaunch gift cards in six steps
- Pick your formats. Decide on digital, physical or both, and the amounts to offer.
- Choose a platform. Match it to your POS and how customers buy from you.
- Write clear terms. Cover how to redeem, balance checks, lost cards and any expiry, in line with local rules.
- Train your team. Show everyone how to sell, redeem and check a balance, and what to do if a code fails.
- Promote around gifting moments. Graduations, Father's Day, teacher thank-yous, birthdays and the year-end holidays.
- Reconcile monthly. Review sold, redeemed and outstanding balances with your bookkeeper.
Your gift card checklist
- Decide whether to offer digital cards, physical cards or both
- Shortlist platforms that fit your POS and website
- Test buying and redeeming a card yourself
- Check local rules on expiry, fees and unclaimed balances
- Write short, clear gift card terms
- Add a gift card button to your website header and Google Business Profile
- Plan promotions for graduations and Father's Day
- Set up a monthly gift card report for your bookkeeper
Frequently asked questions
Can I set an expiry date on my gift cards?
It depends on where you trade. Many countries and US states have rules on gift card expiry dates and fees. Check current official guidance before setting any expiry, and show the terms clearly to buyers.
Is gift card money income when I sell the card?
For accounting purposes, it is usually treated as deferred revenue, a liability, until the card is redeemed. Tax treatment can differ, so ask your accountant how to record it.
Should I offer bonus cards, such as a free extra amount?
Bonus offers can boost sales during gifting peaks, but set clear rules on when the bonus can be used and make sure you can afford the margin. Track bonus value separately from paid balances.
What should I do if a customer loses a gift card?
If your platform records the buyer's details and a unique code, you can often look up the card, cancel the old code and reissue the remaining balance. Decide your lost card policy in advance, write it into your terms and make sure staff know how to handle it politely.
Related reading
The bottom line
Square Gift Cards, GiftUp! and Toast all help small businesses sell gift cards, but the best fit depends on your point of sale and how your customers like to buy. Choose a platform that makes redemption easy at your till, track outstanding balances as a liability and check local rules before you set terms.
Add a clear gift card button to your website this week and plan one simple promotion for Father's Day. A small, well-run program can bring in welcome cash and a steady stream of new customers all year.
