Hello! Just making a post (couldn’t find other mention but may have missed it) about an unusual acceptance issue at a UK post office.
So I went to the post office/corner shop today to send a returns parcel (no payment required).
I noticed a sign saying they cannot take contactless, only chip and pin. Thought this was odd (the chip and pin machine had a contactless reader). Well, I thought, whatever. I have my card (Monzo).
I wanted to pay for a drink because I always feel bad not buying anything when sending a parcel lol, and when they see Monzo on the card they tell me it doesn’t work, they only take debit cards and list some other banks (NatWest, Barclays). So naturally I assume it’s some leftover anti Monzo bias and try to explain that it is a normal MasterCard debit and Monzo is a bank. They said something about the post office system won’t recognise it, but were happy for me to have a go anyway. They put it in the system, which is at the post office side of the counter, and I believe though not 100% had a post office ad on the waiting screen. The charge comes up but says something I don’t recall exactly but along the lines of cash withdraw? I put the card in, and it just beeps and says remove card. No attempted charge at all on Monzo end.
I’m pretty confident it’s not a scam place of any kind. It’s a legit post office and shop, and others in the community use it frequently with no issue.
I told the guy I’d let Monzo know so they can look into it… I thought I’d start here because it’s really confusing, and I also don’t want to get a small business in trouble if it’s something they’ve done “wrong” because it genuinely seems that those cards don’t work there due to some technical issues (as opposed to an issue of them choosing to not allow people to use it, in which case I’d be very pro them getting advice so they can understand and start accepting).
He did say that they have the exact same issue with Nationwide. And also that they can actually pay cash in to Monzo just fine… It’s just payments (withdrawals?) that have the issue.
Anyway, thought it was interesting. Any thoughts, or similar experiences?
This is an example of the post office using ‘cash withdrawal’ method to pay for goods and services rather than through a traditional card payment method. The reason some post offices do this is because it is more profitable for them to do cash withdrawals (the banks who participate pay a fee to the post office for providing the service) whereas as normal card transaction costs the post office money to process the card payment.
The reason it will fail at the post office is because Monzo don’t offer cash withdrawals via the post office (though they do offer cash deposits at the post office). Most traditional banks allow both withdrawals and deposits.
It’s naughty behaviour by the post office, being greedy and insisting of processing as withdrawals rather than card payments so they receive fees. I’m not surprised Monzo opted not to allow withdrawals at the post office, the offending post office branches are fleecing participants of the scheme by processing all card payments as cash withdrawals.
Ah, perfect, that all makes complete sense!!! And as a bonus adds extra context to why Monzo would choose not to do the withdrawal service with them if some post office operators are choosing to use it as a workaround for fees.
Thanks very much for the thorough explanation. So essentially, as a shop they’re actually choosing to not offer card payments, only cash. But because they’re also a post office, they use the post office cash withdrawal service to get the cash to make the payment? It does make sense in the context of this particular shop - I don’t go there often because frankly they don’t have much to buy but I do remember in past years they used to be just plain old cash only for the shop side.
Yea whatever amount the total comes to they process it as a cash withdrawl from the bank that you present your card for (which is why contactless isn’t an option and you have to enter it for chip and pin) then the ‘cash’ you ‘withdraw’ they basically assign as payment against the goods and services.
I don’t really disagree with them doing it in some ways because it’s the most cost-effective way for them to process the transaction.
They really shouldn’t refuse to do it via a standard card payment if the withdrawal fails, as taking a payment whether it be cash or card is a cost of doing business.
Optimise it to your benefit - sure. Refuse to process payments at all for the other customers - no.