With some reports comparing them to giving saving bonds to kids, some stores are introducing prepaid gift cards that can be exchanged for common stock in public companies.
The "Gift Card for Stock" is a collaboration between Stockpile Inc., a startup, and Blackhawk Network, the provider of gift cards at retail stores.
Stockpile's gift card, sold in a separate rack close to the regular gift cards, comes in fixed denominations of $25, $50 and $100. They may be redeemed for a variety of popular stocks, including Coca-Cola, Facebook and Apple, as well as financial products that follow the S&P 500 index and precious metals, such as gold and silver. If desired, shares received can be swapped for other stock.
Buyers can also choose a more general card that gives the recipient a choice of stock.
When recipients redeem a Stockpile gift card and open a brokerage account, they get fractional shares of real stock that they choose. Any buy or sell transaction on Stockpile.com costs 99 cents.
Source: Stockpile
Participants in the initial rollout include Kmart, Ohio's Buehler's Fresh Foods, Giant Eagle and Market District (locations in Maryland, Ohio, Pennsylvania, West Virginia, and Indiana), Safeway (18 locations in Seattle) and Wegmans.
According to a September poll of over 2,000 Americans commissioned by Blackhawk, only 28 percent of American adults own stock. Seventy-three percent of Millennial respondents did not own stock but the poll found 54 percent would be interested in purchasing stock if it were as easy as buying a gift card in a store that could be redeemed online.
"As we approach the holiday season, we think Gift Cards for Stock will appeal to consumers who want to give something more meaningful," said David Tate, Blackhawk Network's SVP, products and marketing. "This is a great gift to teach someone about investing or dip your toe in the market for the first time."
Avi Lele, a former patent attorney, founded Stockpile after wanting to give a Christmas gift of stock to his nieces and nephews but finding the process complicated and expensive. He hopes it lifts education about and overall access to financial markets.
"Your grocery list," Mr. Lele told the Journal, "will be bread, milk, eggs, Apple stock and gold."