Yeah - this seems ridiculous, and defeats the goal of privacy too.

If you pay for everything with cash surely it's much easier to just get a bulk amount of cash out periodically.

If you go to the nearest ATM to withdraw just enough to buy whatever you're buying every time you're out that's almost as much information for someone trying to surveil you as if you'd paid with a card at the store.

Also, getting the cash out at the till to buy stuff at the same store is even more pointless. That's just paying with your card with an annoying extra step.