Increasing Utilization of Prepaid and Gift Cards is Driving the Growth of the U.S., U.K., U.A.E., Mexico, India and Philippines Gift Card Market

The rising utilization of prepaid and gift cards is playing a pivotal role in propelling the growth of the market across various regions, including U.S., U.K., U.A.E., Mexico, India and Philippines. Consumers in these regions are increasingly turning to prepaid and gift cards due to their convenience, flexibility, and versatility. Moreover, as the world embraces digital payment methods and experiences a surge in e-commerce activity, there is a natural shift towards digital formats of these cards. E-commerce sales experienced a significant surge after the COVID-19 pandemic, driven by a shift in consumer behavior towards online shopping due to lockdowns, social distancing measures, and safety concerns.

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Data Bridge Market Research analyses that the U.S., U.K., U.A.E., Mexico, India and Philippines Gift Card Market is expected to reach USD 1,475.91 billion by 2031 from USD 416.20 billion in 2023, growing with a CAGR of 17.5% in the forecast period of 2024 to 2031.

Key Findings of the Study

Rising Popularity of E-Gift Cards and Prepaid Cards in Millennials

The gift card industry and the digital world are interconnected. Companies are engaging their customers virtually using digital marketing strategies and digital platforms since gift cards have become prevalent. In recent years, the gift card industry has experienced an improvement in relationships with existing consumers through marketing and digital promotion, rather than expansion through geographic channels and store network expansion

The rising popularity of e-gift cards and prepaid cards among millennials is reshaping the gift card markets driven by millennials' preference for convenience and digital solutions, businesses are increasingly investing in advanced digital and mobile-first strategies to meet evolving consumer demands. This shift towards e-gift cards and prepaid cards not only enhances customer engagement but also accelerates market growth, positioning companies to capitalize on emerging opportunities in a dynamic digital landscape. As the trend continues, companies that adapt to these changes will be well-positioned for success in the evolving gift card market

Report Scope and Market Segmentation

Segment Analysis

U.S., U.K., U.A.E., Mexico, India and Philippines gift card market is segmented into five notable segments, which are based on the basis product, functional attribute, industry vertical, usage, and merchant type.

• On the basis of product, U.S., U.K., U.A.E., Mexico, India and Philippines gift card market is segmented into physical cards and E-gift cards

In 2024, physical cards segment is expected to dominate the U.S., U.K., U.A.E., Mexico, India and Philippines gift card market

In 2024, physical cards segment is expected to dominate the market with a market share of U.S. with 68.24%, Mexico with 70.13%, India with 69.77%, Philippines with 71.20%, U.K. with 69.14%, and U.A.E. with 68.86% due to their tangibility, wide acceptance, and ease of use. They are popular for in-store purchases, often used as last-minute gifts, and are perceived as more personal compared to digital cards.

• On the basis of functional attribute, U.S., U.K., U.A.E., Mexico, India and Philippines gift card market is segmented into closed loop, universal accepted open loop, and e-gifting

In 2024, closed loop segment is expected to dominates the U.S., U.K., U.A.E., Mexico, India and Philippines market

In 2024, closed loop segment is expected to dominate the market with market share of U.S. with 35.59%, Mexico with 38.56%, U.K. with 37.01%, India with 38.37%, Philippines with 38.42%, and U.A.E. with 36.66% due to emergence of enhanced features and advantages in gift and prepaid cards.

• On the basis of industry vertical, the U.S., U.K., U.A.E., Mexico, India and Philippines gift card market is segmented into retail and corporate institutions. In 2024, retail segment is expected to dominate the market with market share of U.S. with 57.27%, Mexico with 56.19%, U.K. with 55.23%, India with 56.33%, Philippines with 57.79%, and U.A.E. with 55.26%
• On the basis of usage, the U.S., U.K., U.A.E., Mexico, India and Philippines gift card market is segmented into domestic and cross-border. In 2024, domestic segment is expected to dominate the market with market share of U.S. with 88.17%, Mexico with 91.42%, U.K. with 90.85%, India with 91.34%, Philippines with 91.82%, and U.A.E. with 89.12%
• On the basis of merchant type, the U.S., U.K., U.A.E., Mexico, India and Philippines gift card market is segmented into retail and e-commerce, restaurants and dining, entertainment and streaming services, mobile top-up and utilities, and others. In 2024, retail and e-commerce segment is expected to dominate the market with market share of U.S. with 59.48%, Mexico with 60.71%, U.K. with 58.29%, India with 57.10%, Philippines with 58.45%, and U.A.E. with 59.53%

Major Players

Data Bridge Market Research as Target Brands, Inc. (U.S.), Pine Labs (India), Starbucks Coffee Company (U.S.), PayPal.com (U.S.), Blackhawk Network (U.S.), Walmart (U.S.), Apple Inc. (U.S.)  majorly in the market.

Market Development

• In March 2023, Target Brands, Inc. announced enhancements to its Target Circle loyalty program, set to launch in April. The updated program introduced three new membership options, including a free-to-join tier and a paid membership for same-day delivery at USD 49 for the first year. Target also rebranded the Target RedCard as the Target Circle Card, offering an additional 5% discount and extended return periods. These changes aimed to provide a more personalized and rewarding shopping experience, enhancing customer satisfaction and driving loyalty
• In May 2022, Starbucks Coffee Company reported over USD 1 billion in unused gift card balances. CEO Howard Schultz revealed that Starbucks gift cards are used by over 120 million people annually. In 2021, customers added USD 11 billion to these cards, contributing significantly to the company's revenue
•  In January 2024, Best Buy highlighted the versatility of its gift cards, which offer recipients the freedom to choose from a wide range of products, including electronics and home appliances. The company integrated gift cards with the My Best Buy Rewards Program, allowing users to earn points and access exclusive promotions. Best Buy also provided seasonal and occasional promotions, enhancing the value of gift cards. The cards are available online and in-store, offering a seamless redemption experience
• In October 2021, Best Buy announced that all physical gift cards were entirely made of paper and 100% recyclable. This shift, started in 2018, helped to avoid about 196 tons of plastic waste. The company aimed to be carbon neutral by 2040 and supports eco-friendly initiatives, including offering e-gift cards as a zero-waste option
• In November 2023, according to an article published by Buybox, in the U.A.E., although recent disruptions impacted the market, self-use started to gain traction as consumers seeked more mindful spending habits. Factors influencing buying decisions across these markets included convenience, discounts, loyalty rewards, and cultural attitudes toward self-gifting, highlighting the diverse motivations driving the global gift card market

Regional Analysis

Geographically, the countries covered in the U.S., U.K., U.A.E., Mexico, India and Philippines Gift Card market report are U.S., Mexico, U.K., India, Philippines, and U.A.E.

As per Data Bridge Market Research analysis:

U.S. is expected to dominate and be the fastest growing region in U.S., U.K., U.A.E., Mexico, India and Philippines gift card market

In 2024, U.S. dominates the gift card market due to its large consumer base, high disposable income, and well-established retail and e-commerce sectors. Gift cards are deeply integrated into U.S. consumer culture, with widespread acceptance across various industries, including retail, dining, and entertainment. The country’s advanced digital infrastructure supports the growing trend of e-gift cards, and U.S. businesses frequently use gift cards for promotions, rewards, and corporate incentives, contributing to their widespread adoption and market leadership.

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