McGift gift cards: How recipients are scammed out of their money

Are people really not using gift card money or just giving up on the companies behind the cards?

Image for post
Image for post
Photo credit: StevePB/Pixabay

now you’ve probably read a statistic or two about how $1 billion in gift cards is never used. This makes sense for recipients who get store gift cards to places they have no interest in shopping. It’s also reasonable for recipients who feel like they’re going to spend more than they’ve received, usually in the form of shipping and handling or product assembly. But this has always been a head scratcher for me when it comes to recipients who ignored Visa or MasterCard gift cards. These can be used at pretty much any store or website where credit cards are accepted. Why would you ignore free money to use at your favorite places?

What companies such as McGift gift card will not admit is that they’re pretty sure most customers will say, “Never mind. It’s not worth it. I’ll just use my debit card.”

Since I was a teenager, I’ve never let a gift card sit anywhere near me without being wiped out in less than a week — store card, MasterCard, Visa, American Express, whatever. That is, until I ran into the one gift card that made me want to just give up: McGift gift cards distributed and serviced by Blackhawk Network California, Inc., and issued by MetaBank.

All gift cards are not created equally

The average Visa/MasterCard gift card recipient may go into a handful of places and try to spend the given amount as closely as possible. But McGift gift cards bank on you either making one large purchase for the full amount or giving up after one purchase. Here’s how they do it.

For the purpose of simplicity, I will use simple amounts to calculate my real-life shopping trip this week with a $50 gift card:

  • $36 for online delivery meal, including tip
  • $7 at grocery store
  • $7 at dollar discount store

Overcharges for online delivery purchases: Gas stations forewarn you that they’re going to hold more than you actually pay at the pump. Gift card companies such as McGift do not. The online delivery company ended up charging me a higher pending rate than my actual amount — $7 higher. This meant when I tried to use the gift card at the two additional stores, the gift card was immediately rejected. Why? The gift card balance had an available balance of $7 instead of $14 — due to the $43 pending charge ($36 + $7 pending amount).

Customer Service number will not go to operator: When you call the number on the back of the McGift gift card, you are given no initial option to talk to an operator. The website’s “Recent Transactions” also do not notify you that there is a higher pending rate than what you actually paid (in this case, $36 for GrubHub). You are left wondering was there an unauthorized charge. The only way to reach a Customer Service representative is to choose automated options to dispute a charge. Expect the dispute department to also not be able to tell you about higher pending rates and transfer you a second time, with a hold time of more than 20 minutes.

So now the grocery store believes they’ve given me a refund and McGift gift card refuses to credit me for the difference.

Difference will reappear in odd amounts: Out of the $14 pending balance I was waiting on, $7 eventually showed up. But instead of paying for my grocery store purchase with two different cards (my gift card and my own debit card), I asked for a refund for what was deducted. I’d just wait the 7–10 business days for the entire $14 balance to be put back on the card. So in addition to waiting the 2–3 days for the $7 online delivery charge to drop off, I also was informed by McGift that I’d have to wait 7–10 business days for the other $7 to return to my gift card, too.

May initially reject, then accept the amount: Instead of McGift gift card accepting the return from the grocery store, the refund was returned to the grocery store later on the same day — even after I left the store without the $7 worth of items. So now the grocery store believes they’ve given me a refund, and McGift gift card refuses to accept the refund. They went ahead and paid the store hours later. Meanwhile, I had no idea that the store had been paid for items that were left behind the register — until I returned several days later with the $14 available balance popping up on the website. And then my purchase of $14 was rejected a second time even though the website stated I had this exact amount.

After 10 minutes worth of automatic cut-off calls and 30 minutes on hold between two representatives and a supervisor, I was informed that I should return to the same grocery store with my refund receipt, my gift card, and log into the McGift gift card website to show a manager under the “Recent Transactions” option that McGift gift card paid for the items that I never left the store with. Would this look highly suspicious to the store? Absolutely. Did it cost me two trips back and forth to the store? Yes. Did I get my money or my items? Yes, in the form of a store credit that I spent immediately.

McGift gift card tries to stall out gift card recipients

What companies such as McGift gift card will not admit is that they’re pretty sure most customers will say, “Never mind. It’s not worth it. I’ll just use my debit card.” After all, it’s only $7 or $14, or whatever amount is up for dispute. More often than not, gift card holders look at gift cards as someone else’s money. They didn’t pay for the gift card in the first place, so if they lose a little money here and there, it didn’t come out of their pockets. Meanwhile gift card companies have already gotten paid.

Whether you use the gift card or not, it’s no loss to them. They’ve gotten their full gift card amount, plus the gift giver paid the processing fees. And it’s an easy way to scam gift card recipients out of free money.

How to get around scamming gift card companies

Not all gift card companies are like McGift gift cards. I can say with certainty that I’ve never had any of these problems (or overcharges) with Vanilla Visa gift cards, among others. But before you either purchase or use a gift card, ask yourself these questions:

  1. Can I find enough items to purchase for the full amount and avoid the back-and-forth of pending overcharges?
  2. Does this store have the kind of reliable Customer Service that would be willing to properly assist me should something go wrong?
  3. Before I buy a gift card for ____________, do I already know which stores (s)he will use a money gift card in? If so, should I just purchase a store gift card instead, where prior purchases can be easily tracked? (This is especially handy in the case of stores where the recipient already has loyalty points or promotional coupons.)
  4. Complete a test Customer Service call to see what the automated system options are. (A phone number should be on the back.) Never buy gift cards from companies that will not allow you to speak to a human being, conveniently have technical difficulties so you must call back later or require lengthy periods of time to reach someone. Keep track of when this happens to you so that you do not also buy someone a gift card from the same company.

During this holiday season and beyond, just remember that gift cards do indeed help you avoid getting someone a gift they don’t want. But the companies behind them should be honest and helpful enough to want you to spend your gift card money instead of just wanting to get paid.

Would you like to receive Shamontiel’s Weekly Newsletter via MailChimp? Sign up today!

Written by

Check out her five Medium publications: Doggone World, Homegrown, I Do See Color, Tickled and We Need to Talk. Visit to read about her.

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store