Mr Marcin, a loyal reader of cashless.pl, recently visited one of the Masurian restaurants. Satisfied with the service, he left the waitress a dozen zloty tip. However, he had no cash and wanted to pay for dinner with his card. The waitress then offered to add the tip to the bill. He was not particularly surprised, as he had done this more than once. He only wondered for a moment why the waitress had mentioned that he should pay with a Polish bank card (she claimed that such a transaction could not be carried out with a foreign card). However, he did not have time to consider it, so he paid with his Santander credit card and forgot about it.

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How surprised he was when, a few days later, he reviewed the transaction history on his credit card account. It turned out that the waitress at the Masurian restaurant had not added the tip amount to the bill but had made a cash withdrawal, or cashback, of PLN 14. Santander charged a commission of PLN 10 on this transaction.

Cashback is a service that is an alternative to withdrawing cash from ATMs. It can be requested at retail and service outlets when making purchases paid for with a card. Cashback is offered by grocery shops, petrol stations, newsagents, and other companies that want to provide this service to their customers. Unlike ATM transactions, the cashback amount does not depend on the denomination of the banknotes available in the machine. It can be any amount as long as it does not exceed the threshold of PLN 1 000.

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Some banks allow customers to use cashback for free. In others, the transaction fee is low, usually a few zlotys. For example, in PKO BP, Pekao, or mBank, it is PLN 2, and BNP Paribas customers pay a zloty. However, such fees apply to debit cards. The problem is that Mr Marcin was using a credit card. In this case, completely different rules apply.

Like an ATM operation, cashback with a credit card is treated as a cash transaction. Santander (where debit card cashback is free) charges 4 percent for a credit card cash withdrawal but no less than PLN 10. This means that a PLN 14 transaction generated a PLN 10 commission.
The story's moral is that if you want to leave a tip by card, ensure the staff adds the amount directly to your bill. Because if they want to take it as a cashback, extra costs may be involved. Especially if you pay by credit card.