When in an emergency, sometimes someone will justify any means to get cash. Unfortunately, this can lead to the wrong way, for example by making cash swipes. Have you heard the term cash swipe? Often hear the term friction cash or gestun? Already understand about the term? Everything will be discussed in full in this article.

This method is usually often done through the providers of credit card cash friction. Later you can get cash directly. Unfortunately, the cash swipe of the credit card itself is not the right shortcut to getting cash. Why? Everything will be discussed in full in this article.

Definition of Cash Swipe

 Definition of Cash Swipe

Cash swipe is the practice of swiping a credit card into a machine owned by a store (commonly called a merchant ) to get cash. This practice is made as if you were doing a shopping transaction somewhere, but actually you did not get the goods, but instead got money. Cash swipe is often done by credit card owners who do not have enough funds in their savings accounts. They do this habit as a shortcut to get cash.

This practice is usually done to those who provide credit card cash swipe services. These individuals have an EDC (Electronic Data Capture) machine, which can make the transaction as if it happened. Of course this is tantamount to owing, but to EDC machine owners or merchants . Not to mention, usually merchants can charge ‘additional fees’ to the card owner. Of course, card owners can be burdened by even greater accumulation of debt.

This type of service itself is very easy to find in the trade center / trade center and online. They really advertise this service openly and even the banner ads can appear on various internet sites that you frequently visit.

Difference with Cash Withdrawal

 Difference with Cash Withdrawal

Some of you may also have heard of the term cash advance, but really is there a difference in cash friction and cash withdrawal? The answer is there! Cash withdrawal practices occur when you use a credit card to withdraw cash at an ATM. As with cash swipe, you will also be charged a fee for taking cash. However, the fees imposed on the practice of cash withdrawals will be directly charged by the issuing bank concerned, and immediately recorded in your credit card bill in the next month.

However, many people prefer the credit card cash swipe service because the fees charged are lower, in addition the perpetrator can swipe to the credit card limit. Another difference lies in the legality of the practice itself. The practice of cash withdrawal is still permitted by the Government and is considered a legal action, because the card owner makes transactions through an official ATM machine. Whereas gestun practice is considered an illegal practice and is strictly prohibited, and many service providers can take from this transaction in an informal manner.

Examples of Credit Card Cash Swipe Practices

 Examples of Credit Card Cash Swipe Practices

When practicing cash swipes, usually the card owner will be charged a transaction fee. These fees also vary from 2-3%. This fee is of course quite large and billing will be charged directly to your bill during the scraping process. For more details, let’s look at an example of a credit card cash swipe practice below.

Budi wants to get around 5,000,000 in cash, he has a credit card with a limit of 5,000,000 rupiah. Then, Budi approached the gestun service provider and immediately made the credit card friction. Individual service providers / merchants charge a withdrawal fee of 3%. When making a card swipe, the transaction was made as if Budi bought a painting for 5,000,000 rupiah. Of course, Budi did not get the painting, but cash of five million rupiah according to the price written. Then, the calculation is as follows:

Card limit: 5,000,000 rupiah

Withdrawal Fee: 3%

Cash obtained by Budi: 3% x 5,000,000 rupiah = 4,850,000 rupiah

However, the fees that appear on the credit card bill remain a total of 5,000,000 rupiah

Let’s just say that in the following month, Budi is late in making payments on his credit card, so Budi will be charged a credit card interest of (for example) another 2.25%, so that the original bill is only 5,000,000 rupiah to 5,112,500 rupiah.

If counted again, of course you experience a total loss of up to 5-10% of the funds that you should be able to get. Therefore, Joad family still recommends making cash withdrawals with a debit card at an ATM because the fees are much smaller and there are no additional fees. If it is very urgent, another option that can be done is to make cash withdrawals. Of course the risk of administrative costs is much higher and the withdrawal nominal is limited.

Prone to Generating Bad Credit

 Prone to Generating Bad Credit

When viewed from the time of its use, usually the credit card owner decides to do this practice because he does not have enough cash to meet his needs. Moreover, the practice that allows credit card owners to use up to the maximum limit is actually deemed to be inappropriate. The initial goal of having a credit card should be to be able to provide benefits to the card owner. We recommend that you use a credit card only for needs that can benefit you only, for example to get more discounts when shopping.

If indeed a credit card is allocated for shopping, at least use a maximum of 50-60% of the limit you have; because if it’s excessive, chances are that the card owner can risk not having the ability to pay arrears. This can also lead to bad credit.

Of course, taking some money up front when swiping a credit card to take cash is tantamount to taking irresponsible actions, without thinking about the ability to pay bills. If you remember again, usually the purpose of people doing cash swipe practice is to get cash quickly, from here we can see that credit card owners alone do not have enough cash to meet their needs. How could he have enough money to pay the bill the following month?

If you make a delay in bill payments and interest accruing every month, it is not impossible that someone will fall faster and get caught in debt bondage. Next impact? Of course the name of the card owner has the potential to get bad collectability through a bad IDI Historical score and has an impact on the name of the card owner who will be included in the BI blacklist , pursued by debt collectors , and other debt effects.

Gestun is Banned by the Government


Due to the high vulnerability of bad credit credit card owners due to the practice of swiping credit cards to get cash, finally the Government through Bank Indonesia took decisive steps to overcome this problem. Bank Indonesia briefly issued a statement and announced that the gestun practice in Indonesia was illegal and legally prohibited.

The prohibition of cash swipe practices in Indonesia is also done to avoid the practice of money laundering that is rampant. Transactions like this. This also occurs because of the shift in the function of the credit card that is no longer in accordance with the intended use. Credit cards no longer play a role as a method of payment anymore, but rather become a credit facility in the form of cash or roughly as a debt card. This cash swipe practice that has the potential to increase the case of bad loans in Indonesia can in fact affect the issuing banks due to the increase in non performing loans (NPLs), which are considered detrimental to the banking business in Indonesia.

As reported by Tempo, the ban on the practice of cash friction also departed due to the case of the arrest of two perpetrators of criminal acts of counterfeiting, fund transfers, and money laundering with cash swipe mode on credit cards. The perpetrator changes the credit card from its function to purchase goods into withdrawal of money. The losses received were from one year of operation valued at Rp. 600 million.

Provisions to ban cash swipe practices in Indonesia are regulated in Bank Indonesia Regulation (PBI) No.11 / 11 / PBI / 2009 as amended by PBI No.14 / 2/2012 concerning the Implementation of Card-Based Payment Instrument Activities (APMK). The government does not hesitate to take firm action against all merchants or cash friction service providers who still do this. All of these illegal actions will be subject to administrative sanctions and strict actions from the authorities.

So, you should avoid doing cash swipes, because besides harming yourself, the card owner is also indirectly involved in criminal acts. As a wise credit card user, the owner must use the card appropriately and not for cash withdrawals or use until the credit card limit is up.