Gift card liability and refunds

An unspent gift card is money you have already taken and still owe. This article covers the number that says how much, and what happens to it when you refund.

Gift cards are still in rollout. There is no Gift cards entry in your sidebar yet, so you cannot reach this screen from your dashboard today. See the gift cards overview.

How much do I owe in gift cards?

Open Marketing → Gift cards. Three figures sit across the top of the page.

Outstanding liability is the sum of every live card's balance. It includes cards you have disabled, because disabling does not cancel the debt. It excludes cards that were replaced by a re-issue, because their value moved to the replacement and counting both would double it, and it excludes cards past an expiry date, which are counted on the separate line below rather than dropped.

Held right now is a subset, not an addition. It is money that is already inside the outstanding figure and also spoken for by a shopper who is mid-payment. Do not add the two together.

Expired, not written off is reported separately on purpose. Whether an expiry date actually extinguishes what you owe is a legal question that differs by country, so Brainerce never quietly removes that value from your books. It shows it to you and lets you and your accountant decide. This figure stays at zero until you start issuing cards with an expiry date, because the expiry date is optional and empty by default. Once you set one on a card, that card's balance appears here the moment the date passes, and it stays on your books until you do something about it.

Handing the numbers to your accountant

The liability figure alone is rarely enough. Tick the cards in the list and use the export action to get a CSV with one row per card: masked code, balance, spendable, currency, status, recipient and issue date. That is the detail behind the total. See Export your gift cards to CSV.

If you hold cards in more than one currency, read the figure carefully. The three headline numbers are stated in one currency, normally your store's own. They are never a total across currencies, because adding shekels to dollars would produce a liability that does not exist. The page lists each currency separately underneath, and the export has a currency column so a spreadsheet can total each one properly.

Balance versus spendable

Every card carries two amounts, and the difference explains most support tickets on this screen.

• Balance is the money on the card.
• Spendable is what a customer could use this minute.

They differ while a checkout is holding value. A card with a balance of 100 and 80 held has 20 spendable, because a shopper is part-way through paying with it. Nothing is missing and nobody has made a mistake. Holds clear on their own, either when the order completes or when the abandoned checkout expires.

A hold is not a debit. Nothing leaves the card until an order is actually created. Until then the value is reserved, and it comes straight back if the shopper walks away or removes the card at checkout.

Refunding an order that was paid with a gift card

This is the part merchants most often get wrong, so it is worth stating flatly.

Gift-card value goes back to the gift card. It is never refunded to a bank card and never paid out in cash.

When you refund an order that was settled partly by a gift card:

• The refund is split proportionally across everything that paid. An order settled ₪200 by gift card and ₪300 by credit card, refunded ₪100, returns ₪40 to the card and ₪60 to the credit card. Brainerce works out the split; you just enter the amount.
• The gift-card share is credited back to the same card, and appears in its movement history as Refunded to the card.
• An order paid entirely by gift card involves no payment provider at all. The value returns to the card and the refund is complete. There is nothing to wait 3 to 10 business days for.

You cannot redirect a gift-card refund to a bank card, and there is no setting that changes this. If a customer insists on cash back, that is a decision you settle outside Brainerce, and you should adjust the card's balance down afterwards so you are not left owing it twice. See Adjust a gift card balance.

Refunding does not erase the original purchase. The card's history keeps the redemption and adds the refund beside it, so the timeline shows the money moved twice. That is what makes the balance explainable a year later.

Good to know

• Tax was charged on the full order, because a gift card pays rather than discounts. A refund reverses tax the same way it would for any other payment method. See How a customer redeems a gift card.
• Issuing a card raises your liability immediately, whether or not you collected any money for it. Brainerce does not take payment for gift cards and does not check that you did.
• Cards never expire off your books. Nothing writes a card off and nothing zeroes a balance, whether or not you gave the card an expiry date. A card with no expiry date is a permanent liability until it is spent or you adjust it away. A card past its expiry date moves out of Outstanding liability and onto the separate Expired, not written off line, which is a different figure rather than a write-off: the money is still there and it is still yours to account for.
• You can never delete a card to clean up the number. Adjust the balance to zero instead, with a reason. See A gift card can never be deleted.

What's next?

• Refund an order covers refunds in general.
• Manage gift cards covers adjusting a balance and exporting the list.