You pay to withdraw cash from an ATM, and it costs more for an over-the-counter withdrawal in a bank. But you may not know that you can withdraw cash at low cost at tillpoints at national retailers such as Pick n Pay.
In fact, at the moment, if you bank with Capitec Bank, you can even do it free. Capitec recently embarked on a campaign allowing free cash withdrawals at national retailers until the end of December. After December, Capitec customers will pay a fixed fee of R1 a withdrawal at store tillpoints, regardless of the amount withdrawn.
Pick n Pay's chief financial officer, Dennis Cope, says Pick n Pay can handle cash withdrawals from the debit cards |of all banks at its tills - international banks included - at no extra fee to you, the consumer.
But the banks may charge you a transaction fee that will show up on your statement, depending on the bank and the type of account you have.
You do not have to make a purchase to withdraw cash at a Pick n Pay till, and there is no minimum withdrawal amount. The maximum withdrawal amount is stipulated by your bank and is usually the same as the withdrawal limit on ATM transactions.
"The average monthly number of |tillpoint withdrawals in our stores in 2002 was 200 000. This has increased to more than a million cash withdrawals at our tillpoints each month," Cope says.
Keith McIvor, the general banking manager at Absa, says cash withdrawals at point of sale are a more secure alternative to ATMs, "particularly in cases where the customer has noted suspicious characters hanging around an ATM or that an ATM has been visibly tampered with".
He says that over the past two years Absa has seen the number of cash withdrawals at stores such as Pick n Pay, Pep and Shoprite Checkers increase at a rate of 13 percent a year, off a relatively low base of about 500 000 transactions a month.
Carl Fischer, Capitec's executive in charge of marketing and corporate affairs, says Capitec has partnered |with retailers such as Pick n Pay, Shoprite Checkers, Pep, Boxer and selected Spar stores to increase its accessibility to clients.
However, Pick n Pay and Boxer stores are the only stores at which you do not have to make a purchase before you make a withdrawal. In stores at which you do have to make a purchase, the purchase must be made with the same bank card you are going to use to make the withdrawal.
Fischer says drawing cash at tillpoints is less costly and safer than doing so at ATMs, which are a common target for fraudsters, card skimmers and muggers.
George Chirwa, the divisional executive of Nedbank's self-service banking, says that while tillpoint withdrawals do increase convenience for the customer, there are still security concerns about this type of withdrawal and this is why most banks prefer you to use ATMs.
"For example, an ATM card cannot be verified at a tillpoint - this means that cloned cards can easily be used at tillpoints to make withdrawals," he says.
Sugendhree Reddy, the director of banking products at Standard Bank, points out that the banking industry has yet to set rules to govern cash withdrawals at point of sale.
"For example, if the teller short-pays the customer, how do you prove the teller was in the wrong, and who takes the risk on the transaction - the store, the bank or the customer?" she asks.
You can transfer cash through the Shoprite group's money transfer service - even if you do not have a bank account. The service is available at the Money Market counters of the more than 600 Shoprite, Checkers and Checkers Hyper supermarkets in the group.
Brian Weyers, a director of the Shoprite group, says a large percentage of South African consumers still do not have bank accounts and cannot afford the high costs of banking services.
The Shoprite money transfer service is provided in association with Capitec Bank, the sponsoring bank.
All you need is your original identity document (ID), a copy of your ID and the money you want to transfer. The person you are transferring the money to can collect the money at the store of their choice using a secret personal identity number (PIN), which is provided to them by you, the sender.
You can transfer a maximum of R5 000 a day and R25 000 a month, in accordance with Reserve Bank rules. The service will cost you R9.99 a transaction, regardless of the amount transferred.
Pick n Pay plans to introduce a similar service in the future.
Although retailers do not charge you directly for making bank withdrawals, they are paid a fixed fee per transaction by the banks. Pick n Pay is paid a "small fixed fee" of 65 cents a transaction by the banks, chief financial officer Dennis Cope says. "This fee has not increased or changed since cash withdrawals at tillpoints were introduced at Pick n Pay stores 20 years ago," he says.
This bank allows free cash withdrawals at tillpoints of national retailers such as Pick n Pay and Spar until the end of the year. From January 1, 2011, consumers will pay a fixed fee of R1 for a bank withdrawal at a tillpoint, regardless of the amount being withdrawn.
If you are on a "pay-as-you-transact" option, you pay a fixed fee of 90 cents for a tillpoint withdrawal. If you are on the package that allows for for unlimited electronic transactions, there is no charge for tillpoint withdrawals.
If you are on a bundled pricing option such as the Silver Current Account Package or Seniors Offer or you have a prepaid debit card, tillpoint withdrawals are free. Mzansi customers pay R4.50 for tillpoint withdrawals and Mega U account holders pay R3.50.
If you have a Transactor Plus Account you pay R2.25 a withdrawal at tillpoints and if you have a pay-as-you-use current account you pay R3.65.
Mzansi account holders pay R4.70 for a tillpoint withdrawal and E-Plan customers pay R5.20. On current accounts the fee is R3.75 plus 0.75 percent of the transaction amount, capped at R17.