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What a nice little interest-free loan for them!

• papercrane 3y ago
  The interest free loan is more like $1B dollars. This $181M is the breakage, the left over gift card balances that are unlikely to be redeemed and they are recognizing as revenue. e.g. The $2 left on a $20 gift card that someone doesn't bother redeeming. They also get another $1B of deposits from people loading money onto their app to pay for drinks. Starbucks is basically sitting on the equivalent of a small banks deposits at any given time.
  • gffrd 3y ago
    Right, I guess it's really "nice little effortless profit!" This is why gift cards / loyalty balances are just crazy to me. For a little convenience, you turn money into feudal coinage that only ever goes down in value: you see no interest, no adjustment for inflation. $100 on a gift card today is $97 (and probably less!) a year from now, ignoring completely the benefit the financial upside to the company for it. Now I'm all worked up …