Many major church fundraisers, such as goods and services auctions, serve as ways for members and friends to spend money — beyond their annual pledge — to benefit the congregation. It works out well when the fundraiser taps people's personal budgets in a way that benefits both member and church. For example, service auction dinners may come out of a "dining out" budget.
Gift card — also known as "scrip" — fundraising is another opportunity for people to stay within their budgets while still helping the congregation's bottom line. Local grocery store chains will often offer a gift card fundraising program to local schools, churches, and other not-for-profits.
How Gift Card Fundraising Works
The church buys a quantity of gift cards for different amounts ($10, $20, $50, $100, $200), but pays only a percentage (usually 95% to 97.5%) of the face value of a card. The church then sells the cards at full face value to members and friends. The members and friends spend their normal budget on groceries, but the church earns between 2.5% and 5%.
There is usually a minimum dollar amount set by the grocer (often between $2000 and $5000) before the church can place a gift card order. The seed money often comes from operating budget reserves. Gift cards are fairly "liquid" (i.e. they can be converted to cash pretty quickly), so if there was a budget emergency the money could be accessed within a few weeks.
How to Get Started
The fundraiser will need to be approved, and seed money allocated through the proper leadership channels. A team of two or three people should be able to handle the procurement, activation, tracking, and book-keeping associated with the sales. You'll also want a group of volunteers who can work in pairs selling the cards during your social hour. Policies and procedures that track and safeguard the cards and payments also need to be put in place.
You will also want to do a little research on which local chains offer discounted gift cards. Some can be found via services like RaiseRight but others will only sell directly. Once you learn your options, you'll want to poll the congregation to see where people actually shop, and if they would be able to buy gift cards and how much they might purchase per month.
The church will make the most money if people buy the gift cards with cash or check, but having a credit/debit card option will enable more people to participate.
How Much Can We Make?
Selling $1000 per week for cards earning 5% would be about $2500 per year.
Selling $1000 per week for cards earing 2.5% would be about $1200 per year.
A Personal Testimony
I have been buying grocery store scrip through this kind of program for almost 30 years. We started out with paper gift certificates (which was a bit of an annoyance because you had to use the full amount) from one grocery store, but eventually we added two more stores and everyone went to gift cards where you don't have to use the face value all at once. (I use a Sharpie® to mark the remaining balance on mine.)
I tfind it fun to keep a mental account of how much of my grocery bill is benefitting the church. It really adds up!