Post Office took a 20p 'Cash Withdrawal' to buy something?

Usually when I post a letter off in the post office, I can use my debit or credit card with contactless for no problem whatsoever. But yesterday, my girlfriend needed an A4 envelope that was 20p, and neither of us had any change on us so I pulled out my credit card to do a 20p payment. Well the lady behind the desk informed me that on stationary, they take payments out as a cash withdrawal, so I couldn't use my credit card. So I knew most of my money at the moment is on my Barclays account, so I pulled out the card, put it in the machine and she said that the minimum on that bank account to withdraw was £5.

I pulled out my First Direct card, entered my pin and it was a success, 20p was debited as a cash withdrawal rather than a payment. I looked on my statement and it did come up as a withdrawal too, not a payment. Afterwards, I paid for her postage too, this time I was able to pay via contactless on my credit card.

I just want to know if this whole 'cash withdrawal' business is normal practice? I don't feel ripped off or anything, but I'm just curious as to if this is normal?
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  • TheShape
    TheShape Posts: 1,777
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    The Post Office offer banking services for some of the other banks so you can pay-in, withdraw etc.

    Have they simply allowed you to withdraw 20p and used that 20p as payment?

    Won't you get charged interest from the transaction date for a cash withdrawal?
  • bazzyb
    bazzyb Posts: 1,584
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    TheShape wrote: »
    Won't you get charged interest from the transaction date for a cash withdrawal?

    Not for withdrawing cash from a current account.
  • TheShape
    TheShape Posts: 1,777
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    bazzyb wrote: »
    Not for withdrawing cash from a current account.

    I know that :)

    First read, I thought he'd tried the debit card first then used the credit card. Reading it again there are three different cards?

    I guess they've just processed a cash withdrawal. Cheaper (for the Post Office) than paying to process a 20p card transaction.
  • System
    System Posts: 178,077
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    They will receive a fee (from your bank) for the cash withdrawal.
    When you pay them by Visa / MasterCard, they will be charged a card processing fee.

    Makes no actual difference you cost wise.
  • Jlawson118
    Jlawson118 Posts: 1,132
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    TheShape wrote: »
    The Post Office offer banking services for some of the other banks so you can pay-in, withdraw etc.

    Have they simply allowed you to withdraw 20p and used that 20p as payment?

    Won't you get charged interest from the transaction date for a cash withdrawal?

    Yeah they offer services for HSBC and First Direct. I couldn't use my credit card, she said it had to be a debit so I won't get charged interest on it
  • Jlawson118
    Jlawson118 Posts: 1,132
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    Heng_Leng wrote: »
    They will receive a fee (from your bank) for the cash withdrawal.
    When you pay them by Visa / MasterCard, they will be charged a card processing fee.

    Makes no actual difference you cost wise.

    I know it didn't make a difference to me, I was just curious as to why they're practicing like this instead of just taking it off as a normal payment like most services would
  • Jlawson118
    Jlawson118 Posts: 1,132
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    TheShape wrote: »
    I know that :)

    First read, I thought he'd tried the debit card first then used the credit card. Reading it again there are three different cards?

    I guess they've just processed a cash withdrawal. Cheaper (for the Post Office) than paying to process a 20p card transaction.

    So for the 20p I used my First Direct debit card, and then for the actual postage of £2 or something, I was able to use my credit card
  • bazzyb
    bazzyb Posts: 1,584
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    Jlawson118 wrote: »
    I know it didn't make a difference to me, I was just curious as to why they're practicing like this instead of just taking it off as a normal payment like most services would

    Is this an independent post office rather than a main crown office - if so, chances are they sell a few ancillary items themselves (such as this envelope) but don't have their oown card machine for those transactions, hence the cash withdrawal.

    The actual postage was purchased from Post Office Ltd which is why they were able to take the payment through the main post office terminal.
  • d123
    d123 Posts: 8,621
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    Jlawson118 wrote: »
    I know it didn't make a difference to me, I was just curious as to why they're practicing like this instead of just taking it off as a normal payment like most services would

    As has been said, you make a debit card payment they get charged a processing fee, it wouldn't make them allowing a 20p payment viable.

    You withdraw the money and then pay and they actually make a small amount from your bank for the withdrawal and don't get charged the payment fee.
    ====
  • Of course, it would mean that if the envelope turned out to be faulty, and they wouldn't refund/replace, you wouldn't be able to do a chargeback, as you technically paid cash.
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