What Is a Point of Sale Withdrawal and How Does It Work?
Understand Point of Sale withdrawals: how to get cash back with your debit card during a store purchase and what you need to know.
A point of sale (POS) withdrawal allows consumers to obtain cash while making a purchase at a retail location. This service, often called “cash back,” provides physical currency directly from a merchant’s cash register. It offers an alternative to traditional automated teller machine (ATM) withdrawals, integrating cash access into a routine shopping trip.
Understanding Point of Sale Withdrawals
A point of sale withdrawal occurs when a customer uses a debit card to receive cash from a POS terminal during a purchase transaction. This process differs from an ATM withdrawal, as it requires an accompanying purchase and the cash is dispensed by a cashier from the store’s till, rather than from a standalone machine. While ATMs are primarily self-service banking terminals for various transactions, POS terminals are mainly used by merchants to process payments. The primary purpose of a POS withdrawal is to offer convenience, allowing consumers to get cash without needing to locate a separate ATM. Not all merchants offer this feature, and its availability depends on the merchant’s system capabilities and policies.
The Process of a POS Withdrawal
Initiating a POS withdrawal involves a few steps during a debit card purchase. After selecting items and proceeding to checkout, the customer presents their debit card for payment. The POS terminal or cashier will typically offer an option for cash back. The customer then selects the desired cash amount and enters their Personal Identification Number (PIN) to authorize the transaction. The total amount debited from the customer’s bank account includes both the cost of the purchase and the requested cash back amount; once approved, the cashier dispenses the requested cash from the register, along with the purchase and receipt.
Where and What to Expect
Point of sale withdrawals are commonly available at various retail locations, including supermarkets, drugstores, and big-box retailers. The availability of this service, along with specific limits, varies by merchant and their internal policies. Merchants often set daily or per-transaction limits, which can range from $20 to $200.
While many merchants offer this service without an additional fee, some retailers may charge a small fee, typically ranging from $0.50 to $3, to offset their processing costs. Using a PIN-authenticated debit card is a standard security measure for these transactions.