Corporate Gift Cards vs. Bonuses: What’s the Better Employee Reward?

Hey HR folks!! Let’s talk about employee rewards specifically, the age-old debate: corporate gift cards vs. cash bonuses. If you're trying to decide the best way to reward your team, you’re not alone. Every HR manager wants their employees to feel valued, motivated, and appreciated. But the question is, which works better?

I've got thoughts (and examples) on this. Let’s break it down.

Cash Bonuses: The Go-To Reward, But…

Bonuses are the classic choice. A lump sum in the paycheck feels great, no arguments there. Employees can spend it however they want, and it’s a clear financial incentive. But here’s the catch: it’s forgettable.

• Example: Let’s say an employee gets a ₹5,000 bonus. What happens? It gets deposited into their salary account, mixed in with rent, bills, and everyday expenses. A week later, they barely remember they even got a bonus.

Another downside? Tax deductions. A ₹10,000 bonus isn’t actually ₹10,000 in hand after taxes. The psychological impact of a bonus fades quickly, making it less effective for long-term motivation.

Corporate Gift Cards: A Reward They Actually Enjoy

Now, let’s talk about gift cards, specifically corporate gift cards. Unlike a cash bonus that disappears into everyday expenses, a gift card feels like an experience. It’s personal, tax-efficient, and leaves a lasting impact.

Example: Imagine gifting your team members a Myntra gift card during Diwali. Instead of seeing an extra ₹5,000 vanish in expenses, they use it to buy something they love maybe a smartwatch, sneakers, or festive outfits for their family.

Now, every time they wear those sneakers, they remember their workplace and the appreciation they received.

Why Corporate Gift Cards Work Better

• Memorable & Experiential: People remember purchases tied to a specific reward. A gift card turns a reward into a shopping spree, a movie night, or a nice dinner.

• Tax Benefits for Companies: Many corporate gift cards fall under tax-free limits (like meal cards or festive gift cards).
• Encourages Work-Life Balance: A Zomato or Amazon gift card isn’t just money, it’s a “Go, enjoy your weekend!” message from the company.
• Flexibility Without the ‘Salary’ Factor: Unlike bonuses, which employees see as part of compensation, gift cards feel like a genuine “thank you” rather than an expectation.
• Customizable for Different Occasions: Diwali? Give festive shopping gift cards. A performance reward? A travel or entertainment gift card works better.

So, What’s the Verdict?

Both options have their place, but corporate gift cards win when it comes to engagement and impact. A cash bonus feels good, but a gift card feels thoughtful.

Pro Tip for HR Teams: Want to make corporate gifting even better? Use a platform like Dealzy to buy discounted gift cards in bulk. More savings for your company, more happiness for your employees.

Check out Dealzy corporate gift cards: [link]

What’s your take? Do you prefer bonuses or gift cards for employee rewards?