Money

Gift cards flood market

By Xu Fan (China Daily)
Updated: 2010-03-05 13:30

A woman (left) is asking a passer_by whether she has shopping cards for sale outside Parkson Shopping Center on Thursday.

The busy season has begun for the legions of gift card scalpers who make a living from buying unwanted cards and reselling them.

The scalpers say the market is overflowing with previously-owned cards that were given to employees as presents and exchanged between friends and family members during Spring Festival.

Some scalpers say the bloated market has prompted them to cut their commissions and, with a smaller percentage up for grabs, are only bothering to trade in cards with a face value of 5,000 yuan or more.

A dozen scalpers contacted by METRO revealed they had slashed their purchasing prices by up to 3 percent since the period before the New Year holiday. They used to pay between 92 and 95 percent of a card's face value but now give between 91 and 92 percent, depending on the type of card they are being offered.

Although there is no data available on the number of scalpers working in the capital, a Baidu search in Chinese of "retrieving gift cards in Beijing" turned up 218,000 related pages.

A scalper, surnamed Qu, who publishes her mobile number online, told METRO the post-holiday period was typically a lean time for scalpers because "more people are selling but less buying".

She noted that it would be a good time for scalpers to buy up cheap gift cards for resale at a later date, "but the business is becoming tough and we have to be sensitive to traps".

She said: "Some clients sell copied cards that share the same number as the genuine card. When they sell copied cards, they quickly go to malls and spend all the money on the cards."

She said the risk prompts scalpers to want to quickly get rid of cards they bought.

Xiao Li, a reseller in his 30s, revealed more about the underground industry.

He said some "high-end" scalpers will not bother buying and selling gift cards with a face value of less than 5,000 yuan.

"I only earn 50 yuan when I buy and sell a 5,000-yuan card," he explained. "It's not worth it to take transportation to do a trade for a 500-yuan supermarket card."

Gift cards bought and resold by the scalpers include cards from shopping malls, supermarkets, book stores and gas stations.

Zi Xiangdong, a press officer with the public security bureau, said the cottage industry is not necessarily illegal.

"If they affect the normal business order of shopping malls or supermarkets, we would take an interest in it," he said, while pointing out that the bureau had not received any such complaints.

Wu Dezhi, a lawyer with Beijing Jingshun Law Firm, said the underground industry could lead to some corruption because there was still a gap in the law supervising such dealings.