When a customer buys a gift card from your brand, you’re not just ensuring a future sale, you’re opening a powerful new revenue stream.
Think about it: a Rs.100 gift card was purchased today. The customer might redeem it tomorrow… or a month later… or sometimes, not at all. But the moment the card is sold, that Rs.100 is already in your account. You’ve generated cash flow before you’ve had to sell a single product.
This is the hidden beauty of gift cards: they bring in upfront revenue, drive new customer acquisition, and quietly add to your profits in ways many brands don’t fully realise.
Moreover, customers tend to redeem 20-30% higher than the gift card amount – giving the brand an additional profit.
Are You Missing Out on This Revenue?
Two hidden revenue streams power this engine:
- Treasury Income
In India, gift cards typically get redeemed after 30 to 45 days. Until then, the funds sit in the escrow account, earning interest—generating revenue with zero effort. Going by this, at current rates (6% annually), every Rs.1 lakh in gift card sales generates Rs.740 in pure treasury income.
2. Breakage
Across industries, 10–19% of gift cards are never fully redeemed. This leftover value goes straight to your bottom line.
Combined treasury + breakage income accounts for 3.74% → Turns idle money into revenue
An opportunity of a lifetime
Gift card usage is still growing in India, meaning longer redemption cycles and higher breakage compared to other markets. For brands, this translates into stronger margins and improved cash flow.
And there’s more: when customers do redeem their gift cards, they tend to spend more than the card’s value, increasing average order size and customer lifetime value.
In short: Gift cards drive revenue, profitability, and growth—all while being cash flow positive from day one.
How Razorpay Helps You Unlock This
With Razorpay Gift Cards, we help brands tap into the full potential of this opportunity:
- Maximise treasury income with automated escrow management and float analytics
- Optimise breakage intelligently with data-backed insights
- Balance redemption and profitability with smart engagement campaigns
- Stay fully compliant with RBI regulations
- Track performance with real-time dashboards and revenue reports
Whether you’re scaling your gift card program or starting from scratch, Razorpay helps you build a revenue stream that works harder for your business—every single day.
A small example of how the gift card strategy helps you with 2.5 to 3x better ROI compared to traditional strategy.
The Bottom Line
Gift cards aren’t just a marketing tool. They’re a predictable, proven way to improve margins, grow cash flow, and drive repeat customers.
If you’re ready to turn this hidden opportunity into a core part of your revenue strategy Razorpay Gift Cards can help.
