Came across this listing that explains it....it's pretty much what I had thought....
Q: Why would anyone pay more than face value for a gift card?
A: People do it often because they want to use Ebay Bucks that they have accumulated or use other discounts/promos offered by Ebay and Paypal like BIll Me Later. Ebay Bucks let you earn 2% on all your Ebay purchases. In addition to Ebay Bucks and BIll Me Later, people will also pay for the gift cards via Paypal with a credit card that earns them air miles or point(s) which are basically worth cash. In addition to all of this, you can also enter Ebay through 3rd party sites like Big Crumbs and earn cash back. So, you may pay more than face value for a gift card but after you get your Ebay Bucks and credit card points, Big Crumbs cash back etc you will actually end up paying about face value or even under face value if you are clever enough.
1|1|I must have taken my stupid pill today because that went over my head!!!|whitmarg|robin@whitmannet.com|12:36:40|01/13/2012|
:) 2|1|That explains it!|kmarieg|thoughtfulmom@hotmail.com|03:36:25|01/14/2012|
Thanks! I have been wondering about that!! I was so confused when I was seeing people pay $5-25 over value. I was going to try to get some gift cards to spend on Christmas but decided against that!!
Karen
3|2|Robin, see inside|Beaglesfly|lmllr77@aol.com|10:42:04|01/14/2012|
Do you use MyPoints when you buy something online? When you click thru them, you are basically making money (really saving money) because you end up with points that you can cash in for a gift card. Does your credit card or debit card offer $$ back for using it? There too you're "making money" when you buy something. Also, when you buy on ebay, they give you a very small percentage of your purchase back in the form of Ebay bucks so once again you're making money. So add all those incentives up and say they come out to saving an overall 6% of your total purchase price. In that case, you would still come out on top if you paid like 2 or 3% over what the face value is because you're saving 6% of the total in the end.
Seems like a lot of work to work the system in this case, but if you have a spreadsheet do the work for you and you make a lot of large dollar purchases, the savings would be worth it in the end.
I know nowadays, if I see something for clearance online that I want to buy to resell on ebay, first I try to get a good deal on a gift card so I'm saving money there, then I make sure I click through MyPoints in order to get credit for the purchase, and lastly I use my bank card when needed so I get $$ back on that too! Every little penny counts! LOL.
4|1|I guess that could happen, but by paying above face value all your hard work to get the extra money benefits only the seller of the card. So it still really doesn't make sense to me.|suezz|clearys@comcast.net|11:43:47|01/14/2012|
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5|1|i call the stuff that i get from incentives "computer money"|ppe1952|matwell3@rochester.rr.com|14:32:07|01/14/2012|
whether i get amazon g/c from swagbucks, gift cards from other sites that i get paid to clickon stuff etc. it is not cash. therefore when i really really want something and i can get it with "computer money" i get it regardless of the cost because it does not affect the cash flow in my house.
DO NOT meddle in the affairs of dragons for YOU ARE CRUNCHY AND GOOD WITH KETCHUP! 6|1|hmmm I guess I get it|whitmarg|robin@whitmannet.com|22:29:44|01/14/2012|
but it seems like a lot of work for the possibility if making a profit.