by Deanna Ting | July 29, 2013
As the prepaid gift card industry continues to struggle with increasingly tough regulations enacted by the Federal Reserve, a new digital gift card delivery system hopes to help companies avoid fees and liability costs associated with traditional prepaid gift cards.

The new online mobile and desktop service called Kiind lets people and businesses send digital gift cards via email and, instead of pre-paying, pay for the gift card when the recipient decides to use it. 

“With Kiind, you offer someone a gift card. If they don't use it by an expiry date of your choosing, then you don't pay for the gift card,” Kiind Co-Founder and CEO Leif Baradoy explains to Incentive. “Expiry dates on Kiind serve the gift giver. Since no money has been paid for the gift offer, people can expire their gifts without penalty. Once someone claims the gift, then it becomes like a prepaid card. This helps companies control their budgets and reduce waste. Legislation on prepaid gift cards is very stringent, because the cards are like cash. Kiind was built intentionally to get around those laws and to create value for everyone who uses our system.”

Baradoy estimates that businesses can save anywhere from 10 to 20 percent of their incentive budget by using a gift card delivery system such as Kiind. “It’s easy and measureable and completely digital. If people don’t use a particular gift card, it saves the company money. It’s making incentives and rewards a lot easier to give and giving people better return on investment for their programs. You only pay for what gets used.” He added, “Using Kiind increases insights, saves companies money, and saves time."

Clients of Kiind, which include a number of wealth management and financial services companies, represent a range of sizes and needs. Baradoy says that smaller-to-midsized companies that don’t have full incentive solutions or programs often use Kiind as “an easy way to send out gift cards to employees in bulk” through a campaign. “You just have to upload a list of names and then send it out.” For smaller gift card purchases, an organization can just sign up for an account and send them out as they might utilize an app store.

Larger-sized companies or businesses looking to integrate Kiind into their existing incentive programs are encouraged to contact the company directly. “We do some custom partnerships in development on a case-by-case basis,” says Baradoy.

Gift cards sent through Kiind can also be easily customized with a company’s logo, artwork, messaging, etc., and all are sent electronically. “Digital delivery is just fast and convenient and it adds an extra level of security and better insights about who uses what and how much of the budget has been spent or saved,” Baradoy explains. He says that companies are able to track the ways in which their gift cards are being used to improve upon their future gift card programs.

Pricing for the service is based on a per recipient fee. “We charge a small processing fee to send gift cards, ranging from 19 cents (for 100 or more people) to 49 cents per gift card (from one to 10 people). Companies doing a lot of gifting can subscribe to send out 1,000 gift cards every month for a flat fee of $15 per month.

Baradoy and Co-Founder and Chief Technology Officer Peter Locke began to develop Victoria, Canada-based Kiind in 2011 and launched a private beta version of the service in 2012. Cards that can be gifted from the service include those from Amazon, Lucille’s Smokehouse BBQ, Wine Enthusiast, and various local vendors from 35 cities across North America. 

Looking ahead, Baradoy says he is eager to work with more businesses. “The holiday season is coming up and that’s when companies are really trying to close out sales for the year and also to incentivize or reward staff. We’re very much looking forward to showing people how much money we can save them by using Kiind instead of traditional prepaid card reward programs.”