A prepaid card is a means of exchange. A card that can be used as cash has a value at the time of purchase that is equal to the amount indicated on the card. For example, you can purchase a gift card worth $50 of purchases at a store for $50.

Where the card can be used

Depending on the terms of use, the card may be used at a specific merchant or several merchants (in a shopping centre, for example).

Types and formats

There are several types of prepaid cards. They may take different forms: gift certificates, printable vouchers, electronic cards, etc. They may also be made of different materials: plastic, paper, cardboard, etc. They can use different technology: chips, magnetic strips, virtual accounts, etc.

Third party purchase

Prepaid cards that can be used as cash can be purchased from the merchant accepting these cards.

They may also be purchased on group purchasing Web sites or from third party merchants. In both of these situations, you are entering into 2 contracts:

  • a contract with the merchant selling the card;
  • a contract with the merchant providing the goods or services.

Free cards

Prepaid cards given away by merchants free of charge are not subject to the rules provided by the law. Cards received through reward programs, in exchange for points, for example, are also exempt from the rules. Only cards that you have paid for are covered by the law.

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Last update : June 15, 2018

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The information contained on this page is presented in simple terms to make it easier to understand. It does not replace the texts of the laws and regulations.