Synergy Gift Card Holders Face Losses After Company Shuts Down

Synergy World, a San Diego-based gift and loyalty card company, has announced it is shutting down and filing for Chapter 7 bankruptcy protection.

Published on Feb. 9, 2026

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After Synergy World, a San Diego gift and loyalty card company, announced it was shutting down and planning to file for Chapter 7 bankruptcy protection, the company told its customers they can no longer use Synergy's gift cards. Until a bankruptcy court filing, little will be known publicly about Synergy's finances or the state of its gift card operation, including the balance of unredeemed cards and what caused the business to close before it honored its obligations.

Why it matters

The Synergy situation serves as a reminder that there is some risk in buying gift cards, as gift card holders often fall low on the list of creditors when a company goes bankrupt. This highlights the importance for consumers to use gift cards in a timely manner and be aware of the potential risks associated with holding onto unused gift card balances.

The details

Synergy was a third-party gift card business, and restaurants around the U.S. participated in its program. Its cards were sold at Costco. The company was on a growth path in 2024, planning to launch in three new markets after being present in 13 cities and regions. However, the company has now abruptly shut down, telling customers they can no longer use the gift cards.

  • Synergy World announced it was shutting down and planning to file for Chapter 7 bankruptcy protection in February 2026.
  • Synergy initially planned to process gift cards until February 1, 2026, but backtracked and stopped several days sooner due to a 'tremendous surge in redemption rates'.

The players

Synergy World

A San Diego-based gift and loyalty card company that has announced it is shutting down and filing for Chapter 7 bankruptcy protection.

Costco

A retailer that sold Synergy gift cards.

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What they’re saying

“It's a promise for future goods or services.”

— Ted Rossman, Bankrate's principal analyst (San Diego Union-Tribune)

“Typically, when a store goes under, the gift card ceases to be valuable.”

— Ted Rossman, Bankrate's principal analyst (San Diego Union-Tribune)

What’s next

Until Synergy files for bankruptcy, little will be known publicly about the company's finances or the status of its unredeemed gift cards. Gift card holders will likely have to wait for the bankruptcy proceedings to determine if they will be able to recover any of the value on their unused cards.

The takeaway

This case highlights the risks consumers face when holding onto unused gift card balances, especially when the issuing company unexpectedly goes out of business. It underscores the importance of using gift cards in a timely manner and being aware of the potential limitations and liabilities associated with gift card programs.