United’s Gift Card Exchange – Use It To Buy United Miles For Cheap?

I recently received an email from United advertising their own gift card exchange and decided to check it out.  A quick google search shows a version of it existed in 2012, but this is the first I’ve heard of it.  From what I’ve gathered, the back end of that old exchange system was Plastic Jungle which stopped buying cards from the public in 2013 and was later acquired by CardCash in 2014.  While I don’t see anything specific on United’s page declaring that CardCash is the backend system powering the new gift card exchange, a glance at their logos makes the connection pretty obvious.  The conclusion in the reviews several years ago is that the United gift card exchange is a terrible value, but I’d like to analyze it myself.  Adding an additional middle man to the gift card business means the average value is probably less for the end user, but you never know if there will be an odd opportunity to come out ahead.  I’ll provide more details about the program itself below, my experience trying to sell a card, and provide an initial look at what kind of value we might be able to expect.

CardCash's gift card selling steps.
CardCash’s gift card selling steps
United's Gift Card Exchange selling steps.
United’s Gift Card Exchange selling steps

United’s Gift Card Exchange Basics

Direct Link to United’s Gift Card Exchange

Much like you are able to sell gift cards for cash to many different gift card exchanges (CardCash, SaveYa, Gift Card Zen, etc.), United will give you miles for selling your gift cards to them.  The text on their main page says they accept over 100 brands, but a “Gift card retailer list” on the same page only lists 39.  On the actual selling page, there are 155 different brands to choose from for exchanging gift cards.  The main page also has a minimum payout threshold depending on how much your gift card is worth.  The math is a little sketchy with 2x $25 cards have a slightly higher payout (10 miles) that a single $50 card, but since these are labeled “Minimum”, hopefully the actual payout calculation makes more sense.

United's Gift Card Exchange minimum mile payouts
United’s Gift Card Exchange minimum mile payouts

My Experience So Far

By logging in to the gift card offer page, you can input the name of the merchant (which annoyingly tries to auto-complete itself) and the balance on the gift card to get a miles “offer”.  I decided to try a couple different brands to try and get a feel for how much they were offering.  Unfortunately, regardless of what brand I put in, the offer was exactly the same!  From Walmart to Spafinder.com, every single brand returned the same offer and not only that, it was the bare minimum offer listed in the picture above!

United offered 2,660 miles in exchange for a $100 Walmart gift card.  Terrible Deal!!!
United offered 2,660 miles in exchange for a $100 Walmart gift card. Terrible Deal!!!
United offered the same 2,660 for a Spafinder.com gift card.  Not as terrible of a deal as the Walmart card, but you're probably better off with cash.
United offered the same 2,660 for a Spafinder.com gift card. Not as terrible of a deal as the Walmart card, but you’re probably better off with cash.

Technical blurb:  As a software developer, I have a pretty good handle on websites and the inner workings of them, so I decided to check out United’s offer page a little deeper.  When clicking the “Get Mileage Offer” button, the website ONLY passes the balance to the server which then returns the payout seen above.  It’s not even using the brand to determine the payout!!!  I’m assuming this is a bug in the website rather than United paying out the same for each brand, but I can’t say for sure what their plan is.  The calculation appears to be a simple 26.6 * the balance which is then rounded UP to the next number evenly divisible by 10.  Kind of weird, but the rounding does explain the odd minimum payout discrepancy we saw above between $25 and $50.

Upon further examination, I determined the payout for any balance to be approximately 26.6 miles per dollar on the gift card.  Looking at that in reverse, you’re essentially buying United miles for 3.76 cents each but using a gift card to do so.  Normally United miles cost 3.5 cents per point so this might look like a bad deal, BUT we all know how to find and obtain discount gift cards which will lower the price we’re paying.  There might be a deal here after all.  Note: United is currently having a sale on buying miles directly which brings the cost down to 2.45 cents.  (Not a good deal unless you have a very specific redemption in mind that you value at or near the cash price)

The Website Has Some Bugs

After that initial page where they give the offer, I’ve had numerous problems trying to actually type in a card and progress to the payout page.  First the Captcha wouldn’t load so I couldn’t verify the balance at all, then I received an error message that said the card was already sold when actually typing in gift card information for a card I have.  Eventually, I was able to get a Pottery Bard gift card to verify the balance and progress to the 3rd step, but chose NOT to complete the exchange because of the bad value I would be getting.

Can We Work a Deal with the Minimum Payout?

Since the website is either currently broken or only ever pays a minimum regardless of the brand, let’s see if there is an opportunity to get United miles for cheap with just the minimum payout.  First we’ll want a list of all the brands accepted by the exchange, I Made That List Here.  Next we’ll want to compare that list against the brands with the highest discount on Gift Card Wiki.  The second one down the list on Gift Card Wiki’s “ALL” listing sorted by “Discount” is Charming Charlie, but the 50% discount is only on a select few cards that have essentially no balance.  New York & Company a little further down on the other hand has many cards at 40%+ off AND it’s also on the United gift card exchange list.  Now we can see what we’d actually be paying for the United miles if we buy these gift cards and then proceed to exchange them for miles.

  • Cost of $100 New York and Company gift card = ~$60
  • 2% back earned from $60 purchase = $1.2 (or use a United credit card to get 60 miles instead!)
  • United miles for exchanging a $100 New York and Company gift card = 2,660
  • Cost per United mile = 2.21 cents

At 2.21 cents, that’s an better deal than the current current 30% bonus miles sale that United is having.  Even better, if you use a United credit card to buy Amex gift cards at 2.25% cash back and then used those cards to buy the gift cards, the price gets down to ~2.16 cents per mile.

Unfortunately, most people value United miles at less than 2 cents each, so this still isn’t a groundbreaking deal.  If you have a specific United redemption in mind that you value above 2.21 cents per point AND don’t mind jumping through a few hoops, it is possible to buy them for that price.  Keep in mind that buying them in this way (buying gift cards to exchange for miles) carries a decent amount of risk, so I don’t recommend it.

Conclusion – Stay Away For Now

Hopefully United is able to work out some of the bugs and increase the payouts for different brands of cards, but for now the exchange only looks promising in the edge case I outlined above.  It’s essentially possible to buy United miles for 2.21 cents each in almost any amount, but there’s a good amount of risk involved.  Just as buying gift cards from one exchange to sell to another carries a lot of risk, exchanging them for miles carries the same risk.  I’m positive United would claw back the miles if the gift card you sold ended up being a dud for whatever reason.  The added risk and minimal benefit over buying them directly at the moment leads me to NOT recommend buying gift cards simply to exchange for united miles.  Even exchanging gift cards you have lying around for United miles is a poor decision because of the cash payout you could get from traditional exchanges.  One thing my data gathering on United’s old exchange turned up is that they offered bonus miles for selling gift cards in the past.  A large bonus like the 40% detailed by The Points Guy might make the gift card arbitrage for miles worth it.

I’m optimistic that United will fix their payout scheme to increase payouts above the minimum at some point, and any kind of bonus would definitely make revisiting the value proposition worth it.  Until then, it’s probably best to just keep selling your gift cards for cash.

4 thoughts to “United’s Gift Card Exchange – Use It To Buy United Miles For Cheap?”

  1. Just a warning using your example. I bought several of those New York & Co gift cards at a steep discount and received merchandise credit cards instead. They have no pin, cannot be redeemed except in store and have verbiage on the card that says “not nontransferable. May only be redeemed by individual named below. ID will be required” Out of the two cards, one had a name already filled out and the other had pretty obviously been wiped and smudged away. I anticipate a lot of issues trying to pass these things along.

    I know it’s not the point of this post, but just wanted to throw up a caution here in case someone uses the post as a recipe.

    1. That’s a good callout, merchandise credits often have a bunch of restrictions that regular gift cards don’t, but it’s not always obvious what kind you’re buying from the exchanges. One way to avoid that problem is to only buy digital cards because then they should have a pin that can be used online (or resold).

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