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Walmart's U.S. website is testing out a pilot program that will let shoppers trade in gift cards from other retailers and get a gift card that can be used at Walmart instead.

Starting Christmas day, the world's largest retailer says it will start let its customers trade in unwanted gift cards from more than 200 retailers, airlines and restaurants in exchange for a Walmart card that can be used to make purchases in-store or online.

'We recognized that this was an opportunity,' Walmart spokesman Ravi Jariwala said. 'A large number don't get redeemed. We figured this was a good way to get gift cards in the hands of more customers.'

The program will only apply in U.S stores for now, but a Canadian could theoretically apply if they had a U.S. gift card and a U.S. billing address to make purchases in American stores or on the U.S. website.

Walmart says it plans to repurpose and then resell the gift cards it takes in at a discounted rate on their own website.

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The deal does come with a catch in that Walmart isn't offering full value for the gift cards.

A gift card at Amazon.com can be redeemed for only 95 per cent of its value in Walmart store credit. For Staples, the figure is 90 per cent and for Gap, up to 85 per cent. For some brands, a Wal-Mart gift card will be worth just 70 per cent of the original card.

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Retail consultancy CEB TowerGroup says about $1 billion worth of gift cards given out every year never get redeemed. Walmart, on the other hand, says 95 per cent of the gift cards it sells every holiday season are fully used up by February.