US Gift Card And Incentive Card - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts (2026 - 2031)

According to Mordor Intelligence, the US gift card and incentive card market size was valued at USD 207.09 billion in 2025 and estimated to grow from USD 220.38 billion in 2026 to reach USD 300.73 billion by 2031, at a CAGR of 6.42% during the forecast period (2026-2031).

This report is Segmented by Card Type (Open-Loop Card and Closed-Loop Card), by Format Type (Digital Card and Physical Card), by Consumer Type (Individual (B2C) and Corporate (B2B)), by Distribution Channel (Online and Offline), and by Industry of Application (Food and Beverages, Health, Wellness, and Beauty, and More). The Market Forecasts are Provided in Terms of Value (USD).

US Gift Card And Incentive Card Market Trends and Insights

Rapid shift to digital & mobile-wallet gift cards

Mobile wallets have become the default redemption method as Apple Pay and Google Pay acceptance removes the friction of plastic cards at checkout. The Consumer Financial Protection Bureau's 2024 large-participant rule formalized oversight of payment apps that process at least 50 million transactions, underscoring the systemic role of digital gift cards. Retailers gain higher engagement by embedding brand-specific cards in their own apps, while corporate buyers appreciate the instant fulfillment and audit trails that digital delivery provides. This interplay drives a 12.34% CAGR for digital formats and encourages issuers to prioritize real-time balance updates, partial redemption tools, and loyalty integration features.

Corporate demand for incentive cards in HR & loyalty programs

Enterprises treat cards as flexible, tax-efficient benefits that avoid payroll complexities. Spot bonuses and milestone rewards grow in relevance for remote staff, and loyalty managers increasingly swap physical merchandise for digital gift card redemption. Target's loyalty revamp, which quadrupled membership and delivered 350 million incremental guest trips compared with 2019, illustrates how card integration lifts visit frequency. High-volume corporate contracts provide forecastable revenue and dampen seasonality for issuers.

Escalating gift-card fraud & scam losses

Organized fraud rings siphon USD 5.7 billion each year through card-draining tactics that exploit open-loop anonymity. Maryland's Gift Card Scams Prevention Act now requires tamper-evident packaging and staff training from June 2025, and other states are drafting similar rules. Compliance raises costs for retailers, yet stronger security standards also improve consumer confidence, especially for digital formats that avoid on-shelf exposure.

Other drivers and restraints analyzed in the detailed report include:

1. Gen-Z "self-use" gift-card budgeting trend
2. State escheatment-law changes spurring bulk B2B issuance
3. CARD Act & multi-state compliance costs

For complete list of drivers and restraints, kindly check the Table Of Contents.

Segment Analysis

Closed-loop programs maintained a 61.75% share of the US gift card and incentive card market in 2025 because branded issuers control pricing and harvest customer data. They rely on app-based balances that create direct engagement, and unit economics improve without network fees. Open-loop competitors nevertheless outpace overall growth at an 8.62% CAGR, propelled by corporate incentive demand for universal acceptance. Maryland's 2025 security rules that single out network-branded plastics raise execution hurdles, yet Visa's USD 15.7 trillion transaction backbone assures scalability.

Corporate bulk purchasers increasingly mix both formats, sending open-loop cards for cash-like flexibility and closed-loop cards when encouraging spend with preferred suppliers. Issuers calibrate fraud investments, as open-loop designs shoulder higher attack risk. Meanwhile, closed-loop leaders such as Starbucks deepen loyalty integration to lift reload frequency. The coexistence of formats ensures the US gift card and incentive card market remains segmented by use case rather than a winner-take-all scenario.

Digital cards accounted for 58.35% share of the US gift card and incentive card market in 2025 and will expand at 11.86% CAGR, well above the overall US gift card and incentive card market. Low production costs, instant delivery, and mobile wallet compatibility drive adoption. Consumers appreciate partial redemptions that track residual value, and corporate administrators prefer downloadable CSV reports that simplify tax filings.

Physical cards continue serving gifting rituals in grocery aisles where tactile presentation still matters. Hybrid use cases abound, for example, QR-coded holiday cards that convert into app-based balances. Fraud mitigation benefits digital products since activation occurs server side rather than on store racks vulnerable to barcode skimming. Regulators now monitor large digital payment facilitators, which reduces perceived risk and stabilizes growth.

Complete Report Scope:

• By Card Type
  • Open-Loop Card
  • Closed-Loop Card
• By Format Type
  • Digital Card
  • Physical Card
• By Consumer Type
  • Individual (B2C)
  • Corporate (B2B)
• By Distribution Channel
  • Online
  • Offline
• By Industry of Application
  • Food and Beverages
  • Health, Wellness, and Beauty
  • Apparel, Footwear, and Accessories
  • Consumer Electronics
  • Other Industries

List of Companies Covered in this Report:

1. Blackhawk Network
2. InComm Payments
3. Visa Inc.
4. Mastercard Inc.
5. American Express Co.
6. Factor4
7. Tango Card
8. Prepaid2Cash
9. Nift Network
10. Givingli
11. Transcard
12. PopWallet
13. Fiserv
14. PayPal Holdings
15. Amazon.com Inc.
16. Walmart Inc.
17. Starbucks Corp.
18. Target Corp.
19. Apple Inc.
20. Home Depot Inc.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support