I do this for two reasons:

1) Hitting minimum spend requirements for a credit card bonus or discount (e.g. 10% statement credit at [Store of the Week] with a max credit of $10 or something).

2) I have a Target credit card and almost everything in Target, including gift cards, is discounted by 5% if I pay for it with Target's credit card. That makes my Hulu subscription or Nintendo Switch digital purchases 5% cheaper in the absence of anything else.

If you don't have a credit or debit card it's one of the only ways to pay for the service, save asking to borrow a friend's card.

According to the FDIC, 6.5% of American households lacked a bank account at all in 2017.[1]

[1]: https://www.fdic.gov/householdsurvey/

But you could always go with one those reloadable debit cards, no? Though those usually come with a fixed setup fee of, say, $5

It's actually fairly hard to get money onto those without paying a fee (if you don't have a bank account). Most of the obvious ways to get money onto them involve "Visa ReadyLink", and that comes with a service fee from $2 to $5. If I recall correctly, some even have monthly fees if they get below a certain level.

Amazon gift cards can be purchased without a fee most of the time, and with less friction in the store then actually dealing with the service desk in the store that does ReadyLink.

>some even have monthly fees if they get below a certain level

If I receive one for some reason, I've learned to go straight to my computer and load it into my Amazon account.

Reloadable debit cards nickle and dime you with as many ridiculous fees as possible. A poor tax basically.

It's $50 that can only be used on Amazon, but for a lot of people that's a pretty small limitation, especially relative to the utility of being able to transmit it over pretty much any medium.

There are some practical reasons given in this thread. An Amazon card is about as fungible as you get. For me at least, it's even better than a cash card; these days I'll just put that value into Amazon anyway.

Amazon cards are pretty popular when companies have small dollar giveaways of various sort.

More generally, in a lot of circles in the US at least, giving cash as a gift is often seen as a bit crass. So, if you really don't know what to buy a person, a gift card is seen as an at least minimally thoughtful gift that lets the recipient choose what they want. Amazon admittedly tends to fail the minimally thoughtful test but that's the story with gift cards generally.

These days I fund my Netflix account using digital gift cards purchased through PayPal's eBay store, since they frequently sell them at a 15% discount.

If it wasn’t for that I would just pay Netflix directly.

...how exactly are they selling $1 for 85c?

Liquid cash is worth more than store credit. Your "$1" is actually 1 StoreBuck.

It’s super niche, but I have two specific use cases:

- loading an account family members have access to, without linking to the main credit card.

- loading foreign accounts, where small transactions are painful with most cards.

Buying Amazon gift cards gives me the best points<->cash conversion through my credit card rewards program

As far as gift cards go Amazon are the most useful. I usually buy them from my friends for slightly less than their credit value. Win for them as they get cash, win for me as I'll definitely use it and I save some money.