As technology advances and financial services become more digital, so has the most popular gift on everyone’s wish lists: gift cards. Did you know that in 2017, 74 percent of surveyed merchants reported offering an e-gift card option for customers?
One Canadian fintech leading the innovation in e-gift cards is Buyatab. Integrating seamlessly with brands’ pre-existing programs and sites, Buyatab gives businesses that extra edge in customer experience with online gifting. Businesses can reach their customers wherever they are with smartphone options and mobile wallet integrations — allowing brands to tap into the new revenue streams of the modern digital age. Buyatab also caters to gift card distributors to help them gain access to leading brands and provide tools to easily manage them efficiently.
We had a chance to chat with Buyatab’s Founder and COO, Matias Marquez, and find out more about his thoughts on the current state of Canada’s startup scene, fraud, and the future of gift cards.
Trulioo: Congratulations for being listed in Deloitte 50 and Profit 500 list! We’d like to hear your thoughts on some of the opportunities and challenges tech startups face operating out of Canada compared to other hubs like Silicon Valley or London.
Matias: It’s a great question and it’s something that we have been very cognizant about since the beginning. When we were starting out, we found that one of our challenges was dealing with the misconceived perception associated with a Canadian company operating in the United States and abroad. Generally speaking, when people get wind that you’re Canadian, they automatically assume that the team must be small, therefore the output is not going to be as great. That couldn’t be further from the truth! When I started Buyatab, there wasn’t as much buzz about Canadian startups. It wasn’t until the last couple of years that we’ve really started hearing about the amazing talent and innovation Canada produces. Early on, we had to work even harder and in some cases, prove ourselves with the odds largely stacked against us.
Trulioo: In 2018, the value of the gift card market is estimated to be $160 billion. Despite being practical gifts, they’re also vulnerable targets for fraud and financial crime. What are 3 tips you can offer merchants and consumers to protect themselves from being a victim?
Matias: Depending whether you are a merchant or a consumer, the risk of becoming a victim of fraud are very different. From a merchant standpoint, it’s about creating a system that has the nuts and bolts to facilitate secure transactions and ensuring the system cannot be easily compromised. For consumers, it’s more about being careful and thoughtful when it comes to purchasing and handling your gift card.
Our tips for Merchants are:
Consider fraud prevention from the onset.
When a brand decides to launch a gift card program, they need to ensure that their program works with many different aspects of their business such as financial reporting, reconciliation and the customer redemption process. A fundamental aspect that often gets forgotten is fraud protection. If you’re choosing to sell gift cards, whether they are digital or physical, you must have sophisticated anti-fraud systems in place otherwise your entire program can be at risk.
Continuous enhancements to security cannot be seen as optional.
Look for providers and partners that have wide-reaching security controls and still continuously focus on improving security. As an example, it’s not sufficient enough to simply have a barcode on your gift cards. In the world that we’re living in today, you should have multiple security and detection features in place. This includes simple things like card pins and complex card data (identification codes). Without multiple levels of security, your program will be at risk.
Buy gift cards directly from the brand, either through a physical store or through their website. Try to avoid gift card racks or cards placed on display. If that’s your only option, choose the gift cards from the back of the stack, as the ones in the front are more prone to tampering. This might go without saying but avoid purchasing gift cards on craigslist or from an unauthorized seller because if something goes wrong, the brand won’t be able to help you.
Trulioo: What do you predict is the next BIG thing in gift cards?
Matias: Since inception, our vision at Buyatab has always been a world in which all stored value cards are digital. With the increasing adoption of mobile payments, we truly believe physical gift cards will be a thing of the past and that digital gift cards will be the driving force of the future.
We think that as digital gift cards become the standard, we will see new, exciting and more meaningful ways for brands to interact with consumers directly through their gift cards. Digital gift cards give brands the ability to communicate very genuinely with a consumer. As a whole, whenever a brand interacts with a consumer, it generally feels like an advertisement. However, when a consumer already has a gift card, it takes the “sales feeling” out because the purchase has already been made. Thus, any interaction after that point allows the brand to create and leave a more genuine impression on the customer that goes beyond a transaction, it creates a connection.
In summary, don’t be surprised if your gift cards start talking to you! I promise this is not as scary as it sounds.
To learn more about Buyatab and get the latest updates, follow them on Twitter, Facebook, and LinkedIn!
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