Yes, you can withdraw cash from your credit card, but it costs more than a purchase
You can take cash out of your credit card at an ATM, bank teller, or through a cash advance at a store. The process is straightforward — insert your card, enter your PIN, and withdraw money the same way you would from a debit card. But a cash advance is not the same as a purchase. Your credit card company charges a separate fee for the transaction, charges interest immediately (no grace period), and often charges a higher interest rate than your regular purchases.
Most people use cash advances only when they have no other option, because the cost adds up quickly. If you need cash regularly, a debit card or ATM card tied to a checking account is cheaper. If you are considering a cash advance because you need money you do not have, a personal loan or credit line may cost less over time.
Key Takeaways
- Cash advances charge a fee (usually 3 to 5 percent of the amount) plus a higher interest rate than purchases, with interest starting immediately.
- The interest rate on a cash advance is often 2 to 3 percentage points higher than your regular purchase APR, and varies by card and issuer.
- You can withdraw cash at an ATM using your credit card PIN, or ask a bank teller or store cashier for a cash advance over the counter.
- The total cost of a cash advance depends on how long you carry the balance, so paying it back quickly reduces the damage.
Where the fees and interest come from
A cash advance fee is a one-time charge calculated as a percentage of the amount you withdraw. Most credit card issuers charge between 3 and 5 percent, though some charge a flat dollar amount instead (for example, $10 minimum). A $200 cash advance at 4 percent costs $8 in fees alone. That fee appears on your next statement.
The interest rate on a cash advance is separate from your purchase APR. While a purchase might carry an APR of 18 percent, a cash advance on the same card might be 22 or 24 percent. The interest clock starts the day you withdraw the cash — there is no grace period like there is for purchases. If you carry a $200 cash advance for one month at 24 percent APR, you pay roughly $4 in interest on top of the $8 fee.
Your credit card statement will show the cash advance as a separate line item from your purchases, with its own balance, fee, and interest rate. When you make a payment, credit card companies typically apply it to the lowest-interest balance first (usually purchases), so your cash advance balance may sit and accumulate interest longer.
How to take cash from your card
At an ATM: Insert your credit card and enter your PIN. The ATM will show you a withdrawal limit (often $500 to $1,000 per day, depending on your card and issuer). Withdraw the amount you need. The fee and interest charges will post to your account within one to three business days.
At a bank teller: Walk into any bank branch (not necessarily your own bank) and ask for a cash advance on your credit card. Bring your card and ID. The teller will process the transaction and hand you cash. This method works the same way as an ATM but may have different daily limits.
At a store: Some retailers allow you to ask for a cash advance at the register when you make a purchase. You typically cannot get a cash advance without buying something, and the amount is usually small ($20 to $100). This is less common than it used to be.
What limits apply to cash advances
Your credit card issuer sets a cash advance limit, which is often lower than your overall credit limit. If your credit limit is $5,000, your cash advance limit might be $1,500. You can ask your issuer what your limit is by calling the number on the back of your card or logging into your online account.
Daily withdrawal limits also apply. Most issuers cap cash advances at $500 to $1,000 per day, though some allow more. If you need a large amount, you may have to make multiple withdrawals over several days. ATMs have their own daily limits too, which may be lower than your card's limit.
A cash advance also counts against your available credit. If you withdraw $500, your available credit drops by $500 until you pay it back, just as it would with a purchase.
How a cash advance affects your credit score
A single cash advance does not directly damage your credit score, but carrying a high balance does. Your credit utilization ratio — the percentage of your total credit limit you are using — affects your score. If you withdraw $500 on a $5,000 limit, your utilization jumps to 10 percent. The higher your utilization, the more your score may drop.
Missing a payment on a cash advance will hurt your score more than a purchase would, because the interest accumulates faster and the balance grows. Paying the cash advance off quickly keeps your utilization low and prevents interest from spiraling.
Cheaper alternatives to a cash advance
If you need cash and have other options, compare the cost first. A personal loan from a bank or credit union typically charges 6 to 36 percent APR with no upfront fee, and you know the exact payment from day one. A payday loan is faster but much more expensive (often 400 percent APR or higher). A line of credit from your bank may charge less interest than a cash advance and gives you flexibility to borrow and repay over time.
If you have a debit card or checking account, simply withdrawing from your own account costs nothing. If you do not have cash on hand and cannot wait, borrowing from a friend or family member costs nothing if they agree. A credit card purchase (not a cash advance) costs less in interest if you can pay the balance in full before the grace period ends.
The math: what a cash advance actually costs
Here is a real example. You withdraw $300 in cash at an ATM using your credit card. The fee is 4 percent ($12). The interest rate is 24 percent APR. You pay back $100 per month.
| Month | Starting Balance | Interest Charged | Payment | Ending Balance |
|---|---|---|---|---|
| 1 | $312 (including fee) | $6.24 | $100 | $218.24 |
| 2 | $218.24 | $4.36 | $100 | $122.60 |
| 3 | $122.60 | $2.45 | $100 | $25.05 |
| 4 | $25.05 | $0.50 | $25.55 | $0 |
Total cost: $12 fee + $13.55 in interest = $25.55 to borrow $300 for four months. If you had carried the balance for a year without paying it down, the interest alone would exceed $70.
Frequently Asked Questions
Can I use a credit card cash advance to pay off other debt?
You can, but it is usually a bad idea. The cash advance fee and higher interest rate mean you are paying more to move the debt around. A balance transfer (moving a purchase balance to a 0 percent promotional card) or a personal loan costs less. Only use a cash advance to pay other debt if you have no other option and plan to pay it back within a month or two.
What happens if I do not pay back a cash advance?
The balance stays on your credit card and interest keeps accumulating. After 30 days, the late payment appears on your credit report and damages your score. After 60 to 90 days, your issuer may charge a late fee. After 180 days, the account may be sent to a collection agency. The longer you wait, the more you owe and the harder it becomes to recover.
Is there a difference between a cash advance and a balance transfer?
Yes. A balance transfer moves an existing balance from one card to another (usually with a lower rate for a set period). A cash advance withdraws actual cash from your credit card. Balance transfers typically charge 3 to 5 percent but may offer 0 percent interest for 6 to 21 months. Cash advances charge a similar fee but start charging interest immediately at a higher rate.
Can I get a cash advance if my credit is bad?
If you have a credit card, you can get a cash advance up to your limit, regardless of your credit score. Your issuer has already decided you are creditworthy enough to hold the card. However, cards issued to people with poor credit often have lower cash advance limits and higher interest rates.
Do cash advances show up differently on my credit report?
No. A cash advance appears as a balance on your credit card account, just like a purchase. It does not show up as a separate type of debt. However, if you miss payments or carry a high balance, the damage to your credit score is the same as it would be for any other credit card debt.