Christmas is just a few days away and I bet some of you aren’t done with your Christmas shopping yet.  Most of us are baffled as to what to give our friends, loved ones, relatives and acquaintances and I do agree it’s so hard to find the perfect gift.  So most of us resolve to giving gift cards.

A gift card is a restricted monetary equivalent or scrip that is issued by retailers or banks to be used as an alternative to a non-monetary gift; they look like credit cards and can sometimes be reused and reloaded by the receiver or giver.  Blockbuster Entertainment was the first to introduce gift cards to replace gift certificates, or gift checks, since those are easily counterfeited.  Soon after, other retailers and credit providers followed suit, including NABANCO, Neiman Marcus, Mobil Oil, and Kmart.

The only problem with gift cards is that some people think that they’re too impersonal.  It comes off like the giver didn’t even have time to think of what gift to give, so they just thought of giving something generic and safe.  People think that gifts cards give the receivers the freedom to choose their own gifts, which makes things easier for both sides, but still some people prefer to get crappy or cheap gifts that the giver took time to shop for, and not something you can get at the Walgreens cash register.

It’s expected that this holiday season gift card revenue will reach $100 billion, $9 billion more than last year’s revenue.  And  TowerGroup, a Corporate Executive Board Company and leading financial services research and advisory firm, said that more people are using gift cards to the full extent since consumers realized the true value of gift cards.  And because of Title IV of the Credit Card Accountability, Responsibility, and Disclosure (CARD) Act of 2009, which severely restricts expiration and nuisance fees for gift cards, people are choosing this as the best form of gift-giving, since the receiver can use it when they need it, they don’t need to worry about when the gift card will expire.

“The popularity of gift cards continues to grow as e-gifting, currently only a $1 billion business, is poised to reach $11 billion by 2014,” said Brian Riley, senior research director at CEB’s TowerGroup.  “Additionally, increased consumer protection regulations and cards that carry the American Express, Visa, Discover, or MasterCard emblem will increase consumer appeal and help the industry grow at its anticipated rate.”

Though gift cards seem pretty harmless these days, be very vigilant when buying or receiving gift cards, because malicious individuals have found a way to dupe consumers.  Some gift cards could be worthless even before you use it because fraudulent people managed to get the gift card’s PIN and number, rendering the physical card useless.

“The system all too many stores use now is a free buffet for scammers and crooks that can leave unsuspecting victims with a valueless piece of plastic by Christmas Day,” warned New York Senator Charles Schumer.

Aside from being careful of scammers, buyers should know how gift cards really work, like reading the terms and conditions and making sure you tell the receiver what these are.

“Gift cards may look like a good deal, but it pays to check the fine print before you buy one,” said Michelle L. Corey, BBB president and CEO, according to a release. “You may be better off simply giving cash or a check rather than a piece of plastic.”

GiftRocket co-founder Kapil Kale offers a couple of tips on buying gift cards this holiday season:

Focus on flexible. Much of the waste in the gift card industry happens when someone gets a gift card to a place they don’t already go to regularly. Make sure the gift recipient gets something they will use.

When delivering a gift card, be sure to include a personal message. Just handing someone a gift card be perceived as a bit cold, but adding a personal message and communicating the sentiment that you want them to buy something nice on them goes a long ways.

Kale recognizes the growing concerns around gift cards, empowering consumers to utilize gift cards for any store.  It’s the perfect marriage of flexibility and cash, protecting the buyer’s interest and providing value for the person at the receiving end.  A timely update to GiftRocket’s service lets you buy and redeem gift cards from any retailer, putting a bit of value back into the gift card process.

The BBB recommends keeping in mind the following when buying gift cards:

There is no maximum when it comes to monthly fees that can apply after a year of inactivity. A company could charge a very high amount as long as the fee is disclosed when you buy the card.

The plastic card may expire before the five-year redemption period required under the CARD act. Some cards operate like debit or credit cards and have an expiration date. To redeem the balance, you may need to ask for a new card. Expiration dates should be disclosed when you buy the card.

Check the gift card’s terms and conditions. If your friend wants to shop online, make sure the card can be used for that and not just in a store. Fees and limitations should be printed on the gift card packaging.

So before buying tons of gift cards because you’re in such a rush to complete your holiday shopping, think very hard if it is really worth it or you’re just wasting precious bucks.