ATM or Cash Back at the Retailer Point of Sale ?

I wanted to get some cash over the Voorkamerfest week-end which coincided with the end of the month.

Drove down to the Nedbank ATMs and saw a queue about 50 strong. In the cold weather I really didn’t feel like queuing for an age and so made a decision not to bother drawing cash and to forgo an event which required cash.

Having spent many years working with banks on electronic payment systems and transaction handling systems and SASWITCH (in the dark ages of the 1980s) I was embarrassed to realise that I had forgotten all about Cash Backs.

It got me thinking when a day or two later I spotted neighbour John’s mention on Facebook of the convenience of Retailer Point of Sale Cash Backs.

The Cash Back is so simple and so obvious. Buy your bag of groceries and get a Cash Back at the till of a couple of hundred rand and the retailer simply has to process a single transaction. This not only reduces the retailer’s cash holding making them less vulnerable to physical attack, it also avoids the prohibitive cash deposit charge the banks levy on the retailers for using electronic counters to count the cash in a trice.

I was going to list the bank charges from the individual Bank websites but found the websites fussy, and difficult to navigate. Copious information about investment and and and, but no simple table of Transaction fees and Banking fees, almost as if they are a little ashamed ?

The process of retailer cash backs is so obvious and so simple. One imagines that the electronic transaction for purchase approval is a very concise electronic message and needs just a handful of data fields to ensure the bank can process it – e.g. Bank Account number, encrypted PIN number, transaction amount and transaction type being ‘Purchase’. There seems to be no need for a Cash back indicator as the bank’s infrastructure systems can surely process the debit/withdrawal as a single transaction – who cares what the retailer sold the customer, e.g. R200 worth of groceries and R200 worth of cash = total R400. OK, it’s not quite as simple because allowance for the Cash Back to be excluded from the bank charge to the retailer has to be made to avoid the retailer being charged for the Cash Back as part of  the global transaction. There can be no justification however for charging the card holder for a cash back as the computer system is required to process a very simple withdrawal transaction.

Added bonuses of not using ATMs include personal safety, exposure to faulty equipment, ATM out of Cash, infrastructure failure that could even cause the swallowing of your precious card with which you had planned to buy tickets, some frilly knickers, pay for petrol, buy meals and hootch and so on… If this happened on a Friday evening you will have to wait for Monday morning to visit the bank to sort out the mess.

If there is a payout error at a Retailer till point you merely point it out, and the cash is adjusted; and all this can be done whilst your valuable and valued card is in hand and sight. I cannot believe I have been so stupid for so long.

Unless I’ve missed the point, I ain’t using ATMs any more.

If there are errors of commission or omission in this article please use the Reply form below the post to correct them and to extend the debate.

Finally – here are the Bank charges. Speak to your bank for a clearer break-down.

Source –

Piggy Bank

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Ed also makes the coffee...

2 thoughts on “ATM or Cash Back at the Retailer Point of Sale ?

  • September 4, 2018 at 18:56

    Quite often when you want cash back at a check-out point the cashier doesn’t have enough cash in the till to give you more than about R100!

    • September 5, 2018 at 07:41

      Thanks for this info Linda. Could be because so many transactions are done with cards, but might it also depend on the retailer you go to ? Does a garage offer the Cash back facility for example?


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