Hacker News new | ask | show | jobs
by jfim 929 days ago
> And, unlike a bank, your Starbucks gift card balance expires after some period of time.

There are many jurisdictions in which gift card balances do not expire, such as California.

2 comments

Actually true in a technical sense. At least for Starbucks, their gift cards don't expire anywhere globally. In accounting terms though, the company still reduces the value of its gift card liability every year by about 10-15% [1], and claims that this is based on historical data.

Now clearly, there are circumstances in which banks do something similar and close accounts of account holders that are unknown. However, if that occurred at even one hundredth of the Starbucks breakage rate, all regulatory hell would break loose on the bank.

[1] Starbucks reports breakage of around $212.7m in FY22 ($181.1m in FY21). Their liabilities to Stored Value Cards are $1,641m and $1,596m respectively, coming out to a breakage ratio of 13.0% and 11.4% respectively.

People still lose them and never redeem them.
People lose cash too.
And just like whoever finds that cash, Starbucks gets to use the gift card money.