$400 Visa
Okay, it’s not a $500 Visa gift card, but I spotted $400 Visa gift cards in Target. Comes with a $6 activation fee.
                Front and back of card
The highest denomination used to be $200, but they now added the $400 denomination. All the cards are fixed denomination cards, not variable load cards.
[UPDATE 4/12/15: I now see that this same $400 Visa gift card is actually being sold online at target.com as well.]
The usefulness of Target is the fact that many Target stores code as grocery stores and some credit cards earn category bonused rewards for grocery spend. See the Visa Supplier Locator to see if your local Target store qualifies.
There are a few things hindering the usefulness of this find:
- It’s only a $400 denomination. For the same $6 fee, you can buy a $500 Visa gift card at your local supermarket.
- The cards are issued by Bancorp. Vanilla Visa gift cards issued by Bancorp are known to have problems functioning as PIN-based debit cards in Walmart. Though I once tested out the Target Visa gift card in Walmart with an PIN and it worked, that experiment was a while ago and doesn’t reflect the new Walmart reality.
- If you have a convenient Target nearby, chances are that you have a REDbird card or an Amex for Target card, and you’re able to run enough Target spend that way.
Target Gift Cards
The main redeeming factor here would be if it were possible to purchase the Visa cards with a Target gift card, making an easy way of liquidating Target gift cards. In my experience (from a while ago), the Target system is hardcoded not to allow this. I even tried purchasing a Visa gift card along with some detergent, and the system allowed the Target gift card for the detergent, but left the cost of the Visa gift card to be paid with a regular credit card. I tried using a Target REDcard, but I don’t believe it got the 5% discount.
One other thing we’ll mention is that Target also started selling $100 Visa gift card online with a $6 activation fee. I previously wrote that I experimented buying the Visa card with a Target gift card. While the system initially accepted the order, it got cancelled a few minutes later, see Visa Gift Cards at Target.com – why it’s NOT Awesome, and more Target and Walmart Gift Card Experiments.
Final Thought
Despite its limited usefulness, I found it interesting that Target opted for a $400 denomination. This is apparently a thought-out decision based on the payment processing costs of a $406 transaction. They decided that $400 was still worth it for  them.
Somewhat related: I always assumed that the retailer keeps the activation fee (in this case, $6) and the entire card value is  passed on to the Visa card issuer. If that’s the case, it would seem that Target pays less than 1.5% in payment processing fees. Alternatively, they figure some people will pay cash or use a debit card which has very minor fees.
However, Devil’s Advocate has a post where he theorizes that the retailer actually gets an additional percentage of the sale. This would also explain Paypal’s strong crackdown on the use of MyCash cards, since they’re actually losing money on each one. And it would explain the occasional fee-free Visa or Amex gift card sales which arise occasionally.
Update: Frequent Miler let us know on Twitter that people have also spotted $500 cards since at least late 2014 as well.
