“Educating children about credit is imperative” – The confusion between credit cards and gift cards among children

August 2, 2018


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Everybody loves a gift card, assuming it is for a shop or store the receiver actually likes. They can often be used as an incentive as well as a gift, such as the recent announcement that American Red Cross is now giving away $5 Amazon gift cards to donors due to shortages of blood.

However, gift cards aren’t always a blessing for some. They can be one of the most notorious targets for scammers across the world, from a man who bought perfume and aftershave using a fake Debenhams gift card in Liverpool, UK to fraudsters in Detroit who have ripped of bars with gift card-based credit cards.

However, these bars are not the only victims to be confused by tricky credit cards vs gift cards. A recent article on Fatherly highlighted the unexpected impact gift cards can have on a child’s perspective of money and credit. The article titled “Gift Cards for Kids Offer a Confusing Introduction to Credit” discussed why giving gift cards to children has implications for how they make consumer-related decisions and how they spend the “credit” a gift card provides.

Drew Sementa

Drew Sementa, CEO of Tidal Commerce

To get a better idea of the impact that gift cards can have on kids, and how they can be confused with real credit, we spoke with Drew Sementa, CEO of Tidal Commerce, a merchant services company based in Illinois, who said “Educating children about credit is imperative, and something we’re struggling within the US. A recent article in The Street mentioned that ‘71% of teens believe personal finance should be mandatory in schools, yet only a handful of high schools across the country require anything more than a few weeks of basic economic coursework.'”

He adds “I believe that gift cards can be a tool to educate children about credit, if time and effort is actually put in by a parent or caregiver to that end.”
As gift cards continue to evolve, clearly they can be utilized as a tool for good, allowing for better education surrounding money management, while also making lives easier for gift givers and receivers.


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