Are Digital Gift Cards Safe? How to Prevent Fraud and Abuse

Digital gift cards are fast, flexible, and easy to sell. But like any digital product, they come with one big question — Are they secure?

If you’re thinking about offering gift cards online, it’s smart to think through the risks. Digital cards can be targeted by scammers if not set up properly. But with the right tools and protections, they’re just as secure — and often safer — than physical ones.

Here’s what to know about gift card fraud, and how to keep your program protected.

Common Types of Digital Gift Card Fraud

Most fraud happens in a few predictable ways. Here are the ones to watch for:

1. Brute Force Attacks

Hackers use bots to guess gift card numbers or redemption codes — hoping to land on an active one.

2. Phishing & Email Compromise

Scammers trick recipients into giving up codes or email logins by pretending to be your brand.

3. Internal Abuse or Overuse

Sometimes abuse doesn’t come from outside. It can come from:

• Employees generating unauthorized cards
  
  
• Customers trying to reuse promo cards or exploit loopholes
  
  

4. Resale Scams

Fraudsters buy cards with stolen payment info, then resell them on third-party gift card marketplaces before the chargeback hits.

How to Prevent Gift Card Fraud

You can’t eliminate all risk, but you can make fraud very hard — and not worth the effort for most bad actors.

Here’s what to implement:

1. Use Unique, Hard-to-Guess Codes

Codes should be long, random, and not follow a pattern. Avoid things like sequential numbers or common words.

Best practice: 16-character alphanumeric strings with no visible logic.

2. Limit Redemption Attempts

Brute-force bots fail if they’re blocked early. Set a limit on how many times a card code can be tried before it locks or flags.

Bonus tip: Track IP addresses or devices trying to redeem.

3. Tie Cards to Recipient Info

If your gift cards are delivered by email, consider tying redemption to that email address or customer account. This adds an extra layer of verification.

4. Monitor for Unusual Activity

Look out for:

• Large orders of gift cards with no prior purchase history
  
  
• Repeated low-value redemptions across multiple accounts
  
  
• Fast redemptions from new cards at strange hours
  
  

Flag and review these automatically if possible.

5. Protect Promo Cards with Rules

If you offer bonus or promotional cards (e.g. “Buy $50, get $10 free”), set limits:

• Expiration dates
  
  
• One-time use
  
  
• One per customer/email/device
  
  

6. Avoid Public Posting of Gift Card Codes

This might sound obvious, but some businesses post codes in emails or customer service replies that get forwarded around. Keep gift cards tied to verified delivery channels only.

Are Digital Cards Safer Than Physical Cards?

In many ways — yes.

Physical gift cards can be:

• Tampered with in stores
  
  
• Duplicated by photographing barcodes
  
  
• Lost or stolen with no recovery
  
  

Digital cards offer:

• Trackable delivery
  
  
• Immediate deactivation if fraud is detected
  
  
• Easier recovery or reissue if sent to the wrong person
  
  

When done right, digital cards are the safer, smarter option.

How Ncentiva Protects You from Gift Card Fraud

Ncentiva is built to help businesses run secure, abuse-resistant digital gift card programs — without extra tools or tech overhead.

With Ncentiva, you get:

• Randomized, protected codes
  
  
• IP and behavior-based fraud monitoring
  
  
• Limits on redemptions and promo usage
  
  
• Delivery tracking and real-time usage logs
  
  
• Built-in support for expiration rules and redemption verification
  
  

You focus on growing your brand — we help keep your program secure.

Ready to launch digital gift cards without the risk?
Talk to Ncentiva →

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