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“In the U.S., there’s a big problem: There are tens of billions of dollars of unused gift cards every year,” Raise CEO Jay Klauminzer told FOX Business’ Cheryl Casone on “Mornings with Maria" on Tuesday.
Raise allows recipients to sell their unwanted gift cards for cash. Using either Raise.com or the Raise app, individuals sell their rejected gift cards—setting their own discount price—and receive cash for the sale, according to Klauminzer.
In turn, shoppers can go on the website and buy gift cards to their favorite stores at a reduced price, he said.
“We take a small commission—about 15 percent—and then you set the discount for whatever you want on your card,” Klauminzer said.
Brands that are less popular tend to sell at a higher discount rate than more commonly used brands. Amazon gift cards, for example, may sell with a 1 percent discount, while a product like Nutrisystem could see a discount of up to 30 percent, he said.
“It really depends what the supply and demand is of the marketplace,” he said.
In addition to acting as a marketplace for gift cards, Raise allows users to load their cards directly onto their phones through the app. From there, it gives shoppers a barcode they can use at the store.
The company also has direct partnerships with about 500 retailers, according to Klauminzer. He said Raise negotiates a commission with these retailers and then passes discounts on to consumers.