The 12 Best Credit Cards for Purchasing Gift Cards [2021]

Grocery store gift card sales

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It’s difficult to find the perfect gift for that milestone birthday, wedding, graduation, or another special event, but everyone welcomes a gift card. You’re actually giving the person a personalized shopping experience as opposed to items that may or may not be needed or wanted.

Gift cards can also be used for functional purposes such as paying bills and purchasing items you’d normally be buying with cash or credit.

Purchasing gift cards with your rewards-earning credit card can provide an additional dimension to the transaction — you could earn rewards!

And that’s our topic today. We’re going to explore the possibility of purchasing gift cards with your rewards-earning credit card, the benefits of doing so, and also look at some of the potential downsides to watch out for.

It’s an exciting topic and one we can’t wait to dive into, so let’s get started.

Why Use a Credit Card To Purchase a Gift Card

The primary reason you’d want to purchase gift cards with a credit card is to earn rewards. Whether you’re purchasing the gift card to use as an actual gift, utilizing the gift card to pay your bills, or using the card for purchases you planned to make anyway, earning rewards on the purchase could make the transaction economically desirable.

There may also be incentives to reach certain spending levels on a credit card, such as qualifying for a waiver of annual airline spending requirements or earning a free hotel night.

Although gift cards may count towards spending thresholds on a credit card, we do not recommend buying gift cards to qualify for the spending required to earn a credit card’s welcome bonus as card issuers frown on this practice.

Hot Tip: You won’t be earning additional rewards when you spend your gift card, so be sure to use an online shopping portal like Rakuten to make your purchase in order to receive additional potential earnings. Check out CashBack Monitor to determine which portal is offering the most rewards for your upcoming purchase. You may be able to double-dip and earn rewards both when you purchase your gift card (with your rewards-earning credit card) and when you shop with your gift card. 

Types of Gift Cards

Happy Cards
Some gift cards can be used at a single merchant while others can be used at multiple merchants. Image Credit: GiftCards.com

Gift cards come in a variety of flavors, including those that can only be used at 1 specific retailer, those that work at multiple stores, and those that are limited to a single payment processing network such as Visa or Mastercard.

Here are a few of the types of gift cards you’ll encounter during your shopping:

Single-Store Gift Cards

Single-store gift cards can only be used at a specific merchant. Examples of single-store gift cards would be those that include a branded label such as a Bed Bath & Beyond gift card, Lowe’s, Applebee’s, Target, etc. These cards are often referred to as closed-loop cards.

Multiple-Store Gift Cards

Multiple-store gift cards come in all sorts of combinations with fun names such as Happy Cards, Spafinder, ChoiceCard, or Giving Good cards. Additionally, you’ll find multi-store gift cards that can be used at a family of partner merchants such as a Sam’s Club gift card that can also be used at Walmart, or a Darden’s gift card that can be used at a variety of restaurants such as Olive Garden, Bahama Breeze, Longhorn Steakhouse, and more.

Single-Category Gift Cards

Category gift cards allow you to make purchases with merchants in a specific category. The Everywhere family of Visa gift cards, for example, has categories such as Fashion, Dining, Fuel, Explore, Groceries, and more.

You can use these gift cards with any participating merchant that sells the items or services in the specific card category.

Single-Network Gift Cards

Certain gift cards are not limited to purchases with specific merchants but work with merchants that accept a particular payment processing network. You can purchase Visa, Mastercard, or American Express gift cards that may be used anywhere these payment processing networks are accepted.

There is a fee charged when purchasing these cards, unlike most single, multi-store, or category gift cards that normally do not charge an additional fee.

Bottom Line: There are several different types of gift cards, including those that only work at a single merchant, those that work at several stores, and gift cards that can be used at any store that uses the same processing network as the gift card. Single-network gift cards such as Visa, Mastercard, and American Express gift cards charge a fee at the point of sale. Regardless of the type of gift card you purchase, prior to making the purchase, be sure to know exactly how and where the gift card can be used.

Purchasing Gift Cards With Credit Cards — Proceed With Caution

Chances are you won’t have a problem purchasing gift cards with a credit card, but there can be hiccups, especially if you purchase gift cards in volume. You may not earn the level of rewards you expected, gift cards could be excluded as an eligible purchase by the card issuer, or in volume, there may be more of a chance for problems to surface with activation and/or using the gift card.

We’ll get into the details of the potential downsides of purchasing gift cards with a credit card later on in our article. However, because there are far more positives than negatives to the practice, we’ll focus on the positive aspects for now.

Here are some of the best credit cards you can use to purchase gift cards and earn maximum rewards.

Best Credit Cards for Purchasing Gift Cards at Grocery Stores

Gift card purchase at grocery store
You can buy cruise line gift cards at grocery stores to earn some big-time points! Image Credit: Katie Seemann via Zen Life and Travel

Grocery stores commonly sell a large variety of gift cards. It’s also easy to add a gift card at checkout time when you do your weekly grocery shopping.

Here’s a sampling of the types of gift cards you might find at your local grocery store.

It’s worthy to note that most credit card issuers do not categorize warehouse-type stores, such as Target or Walmart, as grocery stores.

Here are some of the best cards for supermarket purchases, including gift cards:

American Express® Gold Card

With elevated rewards of 4x Membership Rewards points for up to $25,000 in U.S. supermarket purchases each year, the Amex Gold card is a perfect card to purchase an occasional gift card.

Blue Cash Everyday® Card from American Express

We like that, although the card earns well with a capped 3% cash-back on U.S. supermarket purchases, you won’t have to pay an annual fee. Plus, you might use the card for a major purchase, or purchases, as the introductory 0% APR will save you interest charges while you repay the purchase back over time. As with all intro 0% APR offers, regular APR, as indicated in the table above, applies after the introductory period.

Hot Tip: If your insurance company takes credit or debit cards, you may be able to purchase Visa or Mastercard gift cards at the supermarket, earn elevated rewards, then pay your insurance bill (which may normally result in just 1x earnings) with your gift cards. 

Blue Cash Preferred® Card from American Express

With a nice welcome bonus, 6% cash-back at U.S. supermarkets (up to $6,000 in purchases each year; 1x thereafter), and an annual fee that is waived the first year, the Amex Blue Cash Preferred card has some compelling reasons to try the card out to see if its a fit.

To learn more about the best credit cards to use at the supermarket, we’ve put together a list of our favorites.

Hot Tip: The Chase Freedom Flex℠ Credit Card and the Chase Freedom Unlimited® Card are currently offering 5x cash-back at grocery stores, up to $12,000 in purchases, for the first 12 months after card approval. 

Best Credit Cards for Purchasing Gift Cards at Office Supply Stores

As a business owner, you’ll have plenty of reasons to purchase gift cards at office supply stores. Office renovations, promotional incentives for employees, and paying for business dining/travel/entertainment could be likely examples.

Here are a couple of business credit cards that can be used for earning maximum rewards at office supply stores.

Ink Business Cash® Credit Card

The Ink Business Cash card is likely the best card for office supply store purchases as it earns 5% cash-back (in the form of Ultimate Rewards points) on up to $25,000 in purchases each account anniversary year.

Ultimate Rewards points earned on the card can be transferred to Chase premium cards such as the Chase Sapphire Preferred® Card, or the Chase Sapphire Reserve® for up to 50% more value when redeemed for travel via the Chase travel portal. Points, once transferred, can then be transferred to hotel and airline partners for even greater potential value.

Huntington Voice Business Credit Card℠

With 4% cash-back earnings on 1 from a list of 10 bonus categories each quarter, including office supply stores, the Huntington Voice Business card is a good choice for earning on your business purchases, all without an annual fee.

Because you can earn 4% on up to $7,000 in purchases each quarter, you could earn up to $1,120 each year. Other bonus categories include grocery stores, gas stations, travel/entertainment, restaurants, electronic stores, utilities, warehouse/discount stores, department stores, home improvement, and auto parts stores.

Bottom Line: With the wide variety of expenses business owners have, there should be no problem maximizing spending limits for bonus categories that include office supply stores. 

Best Credit Cards for Purchasing Gift Cards at Gas Stations

Paying for gas with a credit card
Image Credit: LIGHTFIELD STUDIOS via Adobe Stock

Gas stations often run promotions on gift cards, including their own brand, single-store gift cards, or Visa/Mastercard gift cards. Picking up a gift card when filling up your tank is an easy way to multiply your rewards. Note that not all gas stations will accept credit cards as payment for a gift card.

Here are a few cards that reward your gas station purchases well:

Hilton Honors American Express Surpass® Card

The Hilton Surpass card earns big at U.S. gas stations with 6x Hilton Honors points per dollar spent. Additionally, you’ll earn the same 6x earnings at U.S. grocery stores and at U.S. restaurants.

The card also offers a free weekend hotel night after spending $15,000 on the card in a calendar year and cardholders enjoy 10 worldwide Priority Pass airport lounge passes each year.

Citi Premier® Card

Earning 3x ThankYou Points on gas purchases, air travel/hotels, and at supermarkets and restaurants makes the Citi Premier card a good choice for everyday purchases.

Costco Anywhere Visa® Card by Citi

With no annual fee and 4% cash-back at gas stations, the Costco Anywhere Visa card is the perfect card for Costco members to make gas station purchases. You’ll also earn 2% on other Costco purchases, including in-store gift cards.

Amex Blue Cash Preferred Card

In addition to earning well at U.S. supermarkets, the Amex Blue Cash Preferred card earns 3% cash-back at U.S. gas stations.

Bottom Line: Gas stations can sell all sorts of gift cards, not just gas gift cards. It’s also common to find in-store promotions that offer greater earnings or discounted/free gas. 

Best Credit Cards for Purchasing Gift Cards From Rotating Bonus Category Merchants

Bonus-earning merchants that change on a quarterly basis can present unique rewards earning opportunities. Here are just 2 of the best cards that offer quarterly bonus earnings in specific categories.

Freedom Flex Card

Credit CardBenefits & Info

Chase Freedom Flex℠ Credit Card


Freedom Flex℠ Credit Card
Learn More
(at Chase's secure site)

  • Earn a $200 Bonus after you spend $500 on purchases in your first 3 months from account opening.
  • Earn 5% cash back on grocery store purchases (not including Target® or Walmart® purchases) on up to $12,000 spent in the first year.
  • Earn 5% cash back on up to $1,500 in combined purchases in bonus categories each quarter you activate. Enjoy new 5% categories each quarter!
  • Earn 5% on Chase travel purchased through Ultimate Rewards®, 3% on dining and drugstores, and 1% on all other purchases.
  • 0% Intro APR for 15 months from account opening on purchases, then a variable APR of 14.99 - 23.74%.
  • No minimum to redeem for cash back. Cash Back rewards do not expire as long as your account is open.
  • Good to Excellent Credit Recommendation (670-850)
  • Annual Fee: $0

You can’t beat 5% cash-back on up to $1,500 in purchases each quarter when spending at quarterly bonus-earning merchants. Here are some examples of merchants that may sell gift cards:

  • Amazon
  • Department stores
  • Drugstores
  • Home improvement stores
  • Gas stations
  • Office supply stores
  • Paypal
  • Restaurants
  • Warehouse clubs and superstores

U.S. Bank Cash+™ Visa Signature® Card

The no-annual-fee U.S. Bank Cash+ Signature card also earns 5% cash-back on 2 quarterly bonus categories (up to $2,000 per quarter) and 2% on 1 category.

Bottom Line: Merchants and service providers offered as quarterly bonus categories may sell gift cards that could help you maximize earnings each quarter. 

Additional Sources for Discounts and Bonus Earnings on Gift Cards

Family Fare Gift Card Offer
Check local weekly ad circulars for merchant offers on gift cards. Image Credit: Family Fare

Be on the lookout for opportunities to earn additional rewards when purchasing gift cards with your credit card. Here are some examples of places to look:

Amex Offers

It always pays to scroll through your Amex offers for deals on gift cards. An example of a recent offer was a $15 statement credit for a purchase of $100 or more in Happy Gift cards. Since Happy Gift cards charge no additional fees, you could make $15 on the deal.

An additional offer of a $50 statement credit for a $200 Marriott purchase triggered when purchasing a Marriott gift card at a local Marriott-branded property.

Your experience may vary, but it’s definitely worth checking out your Amex Offers for potential deals on gift cards.

Chase Offers

Not as lucrative as Amex Offers, but Chase often features statement credits for popular merchants such as Lowe’s, Big Lots, gas stations, and other retailers that sell gift cards. Log in to your Chase card account to find these offers and add them to your card account, including debit cards.

Grocery Store, Gas Station, and Retailer Promotions

One of the best ways to snag a deal on gift cards is to take advantage of promotions offered by merchants near you.

For example, a local gas station could offer $1 off on Visa gift cards and a check of the weekly grocery store ad may see a promo that gives $5 in grocery credits for each $50 worth of gift cards purchased. In addition, it’s not uncommon to see an office supply store discounting card activation fees or a nearby retailer offering an additional $25 added to every $100 worth of gift cards purchased (especially around the holidays).

Who knows what types of offers you’ll find when checking out local promotions!

Bottom Line: There may be promotions readily available that can be utilized to maximize your return when purchasing gift cards. Review your credit/debit card offers, scan the local merchant weekly ad circulars, and check in-store postings for opportunities to earn more when purchasing gift cards with your credit card.

Downsides of Purchasing Gift Cards with Credit Cards

While the upside of purchasing gift cards with your credit card can be beneficial, there are some downsides to watch out for.

Fees

Not all gift cards come with activation fees, but if you purchase single network cards such as Visa, Mastercard, and American Express, expect to pay fees as much as $6.95 per card. In order to to make economic sense, the rewards you receive should offset any fees charged.

Single/multi-store and single-category gift cards do not normally charge an additional activation fee.

Credit Card Terms and Conditions

Your credit card’s terms and conditions may exclude earning rewards on gift cards. For example, American Express terms and conditions state that: “Eligible purchases do NOT include fees or interest charges, balance transfers, cash advances, purchases of traveler’s checks, purchases or reloading of prepaid cards, purchases of gift cards, person-to-person payments, or purchases of other cash equivalents.”

Other credit card issuers may have similar terms/conditions.

These statements do not mean, however, that you will not earn rewards on your gift card purchase. In fact, it is common to earn rewards on gift card purchases. You should just be aware that the card issuer could choose to enforce this policy at any time.

Additionally, be aware that card issuers may frown on you buying gift cards while trying to qualify for a card’s welcome bonus, resulting in you not qualifying for the bonus.

You May Not Earn Rewards

If you’re purchasing a gift card to earn rewards, it’s always good to do a test purchase to be sure you’ll earn the proper level of rewards. For example, if a card’s terms and conditions exclude gift cards, you could include a small gift card purchase with your weekly grocery purchase to determine if you would actually earn full rewards.

In some cases, you will not. Do not purchase large amounts of gift cards without testing first.

Additionally, be aware that some online e-gift cards may be sold by third parties and not the bonus-category earning merchant you had hoped for. An example might be hotel or airline-branded gift cards that may be sold by Points.com.

Lost, Stolen, or Failed To Activate

Regardless of how you pay for a gift card, if it is lost, stolen, or the card was not activated at the point of sale, without the proper documentation, it can be difficult to replace.

Although rare, and mostly with prepaid cards such as Visa, Mastercards, or American Express (rather than single- or multi-store cards) you may experience that the balance has been withdrawn from the gift card as a result of hacking.

Another situation can occur when the card was not properly activated at the point of purchase but your credit card was charged. The gift card would then reflect a zero balance.

While all of these situations are possible to resolve with proper documentation, it can be a hassle.

Finally, it’s a good idea to register the gift card online, using the information that comes with the card, in case the card is lost or stolen.

Interest Charges

A good rule to follow, regardless of the type of purchase you make with your credit card, is to pay off the credit card balance in full each statement period. Failure to do so negates any rewards you might have earned on the purchase and contributes to adding up debt (and interest charges) on the card.

Bottom Line: Always do the math to make sure any rewards you receive offset any potential card activation fees. Do a test purchase to ensure you’ll receive the correct level of rewards, and know what to do if there is a problem with any of the gift cards you purchase. Also, be sure to keep all receipts until the full value of the gift card has been used. 

Best Cards for Purchasing Gift Cards — Summary

We’ve covered a lot of information, so let’s bring it all together with a breakdown of which card works best where. Here are the cards we’ve mentioned today and where you might find the best rewards when purchasing gift cards:

CardBest Merchant/Service for Gift Card Purchase
Amex Gold card
Amex Blue Cash Everyday card
Hilton Surpass card
Citi Premier card
U.S. supermarkets, U.S. gas stations, restaurants
Amex Blue Cash Preferred cardU.S. supermarkets, U.S. gas stations
Ink Business Cash cardOffice supply stores
Huntington Voice Business cardOffice supply stores, gas stations, home improvement, electronics stores, restaurants
Costco Anywhere cardGas stations, restaurants, Costco
Freedom Flex cardGrocery stores, restaurants, drugstores (during the first 12 months after card approval), and various quarterly bonus-category merchants
Freedom Unlimited cardGrocery stores, restaurants, and drugstores during the first 12 months after card approval (this may be a temporary offer and could expire)
U.S. Bank Cash+ Signature cardVarious quarterly bonus-category merchants

Final Thoughts

Purchasing gift cards with a credit card can be an easy way to earn a lot of rewards. And, while purchasing an occasional gift card should be perfectly fine, purchasing a large volume could raise red flags with the card issuer.

While this is not an exhaustive list of every credit card you could use to purchase gift cards, the list is designed as a snapshot of possibilities to consider for maximizing the bonus categories on your existing cards and for learning about new cards that might fit your spending profile.

You’ll want to check out your local merchants for those that sell gift cards and that also allow you to purchase with a credit card.

Adding gift cards to the mix of spending on your credit card could turn out to be very rewarding.


The information regarding the Huntington Voice Business Credit Card℠, Hilton Honors American Express Surpass® Card, Chase Freedom Flex℠ Credit Card, Chase Freedom Unlimited® Card, and U.S. Bank Cash+™ Visa Signature® Card was independently collected by Upgraded Points and not provided nor reviewed by the issuer. 

For rates and fees of the American Express® Gold Card, click here.
For rates and fees of the Blue Cash Everyday® Card from American Express, click here.
For rates and fees of the Blue Cash Preferred® Card from American Express, click here.


Frequently asked questions

Can I buy a gift card with a credit card?

Yes, many merchants accept credit cards as payment for gift cards. However, there are some merchants that do not.

Can I use a gift card to pay my bills?

Yes. You can use a Visa, Mastercard, or American Express gift card to pay most bills with a merchant or service provider that accepts the corresponding payment processing network.

Store cards can not normally be used to pay the store-branded credit card bill — it will depend on the merchant.

Do gift cards charge fees?

Most single and multi-store gift cards do not charge activation fees. Visa, Mastercard, and American Express gift cards do charge fees at the point of sale.

Some cards do charge a fee if the card is not used within a specific amount of time, i.e. after 12 months or a monthly service fee. Be sure to check the terms and conditions for each gift card.

Which is the best credit card for purchasing gift cards?

There is no 1 best credit card overall for purchasing gift cards. The best card for you will depend on if you have merchants near you that allow you to use a credit card to purchase a gift card.

If a merchant accepts a credit card for a gift card purchase then the merchant should also be a bonus category merchant that will earn you multiple times rewards when using that credit card.

Check out the merchants you frequent to see if gift cards are sold, then purchase a lower-value gift card using your credit card that earns bonus rewards. If all goes well, you may have found the best card for you for purchasing gift cards.

Is it worth it to redeem points or miles for gift cards?

It is not normally worth it to redeem rewards for gift cards. However, there can be situations where it makes sense to do so.

If points earned on your card can be transferred to airline or hotel partners or redeemed for much greater than 1 cent each via travel portals, these redemption options can result in you receiving the best value.

If your rewards are due to expire, you do not plan to travel, or if you have very few rewards and plan to close out your card, redeeming for a gift card could provide a viable option.

Additionally, if you find a sale or promotion on gift cards where you will receive greater than 1 cent each for your points, the redemption can also make sense, especially if your card’s points have a fixed redemption rate of 1 cent each. A gift card sale could deliver better value.

Christine Krzyszton

About Christine Krzyszton

Christine, who lives in Northern Michigan, travels about 300,000 miles a year despite her remote location. Her expertise is traveling the world on a weekend with no pre-determined destination in mind, letting the cost of the airfare determine where she will go. She has over four million flown miles and elite status on all three major domestic carriers.

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