Digital Gift Cards Are Poised to Become a $1 Trillion Market by 2032

The global digital gift card market is projected to reach $1.2 trillion in 2032, up from $310.1 billion in 2022, according to a report from market research firm Custom Market Insights.

In 2023, CMI projects sales of digital gift cards will total $399 billion, a more than 28% year over year increase. Digital gift cards are gift cards that are bought online or through mobile apps and sent to consumers via email of digital messaging apps.

Driving the growth in digital cards are such factors as consumers’ increasing use of mobile wallets and e-commerce sites for making purchases; gift card issuers growing use of personalization features, such as enabling consumers sending a gift card to include personalized messages, images, or videos; and improved security features such as password protection and data encryption to prevent fraud and unauthorized usage.

In addition, CMI cites cross-border gifting, or the ability for consumers to send digital gift cards to friends and family in other countries, as another factor driving growth.

North America has some of the highest adoption rates for digital gift cards of any region globally, according to CMI. Factors driving adoption in North America include widespread use of e-commerce and a culture of digital payments. Key issuers of digital gift cards in North America include Amazon.com, Walmart Inc., and Starbucks Corp., all of which have leveraged their retail presence and digital infrastructure to capture market share, the report says.

In Europe, personalization and the creation of unique gift cards for travel and luxury brands have helped to drive growth. Key gift card issuers in this region include Apple Inc. and Tesco PLC. Asia Pacific is considered a region that represents immense potential for digital cards due to the rising adoption of digital payments, rapid growth in e-commerce, and a digitally savvy population. Key players in this region include Alibaba Group Holding Ltd., JD.com Inc., and Rakuten Inc.

The Latin America, Middle East, and Africa region is considered an emerging area for digital cards thanks to growing e-commerce landscape, increased smart-phone penetration, and the adoption of mobile-payment solutions. Key issuers in this region include MercadoLibre Inc., Falabella, and Jumia Technologies AG.