Yes, you can take cash out of your credit card, but it costs more than a regular purchase
Most credit cards let you withdraw cash at an ATM or get it from a bank teller using your card's PIN. This is called a cash advance. The money comes from your credit limit, just like a purchase does — but the fees and interest rates are steeper, and interest starts accruing when ready instead of after a grace period.
The catch is that a cash advance is treated as a loan, not a purchase. You pay an upfront fee (usually 3 to 5 percent of the amount you withdraw), a higher interest rate than your regular purchase APR, and no interest-free grace period. If you need cash urgently, it works. If you have other options, they are almost always cheaper.
Key Takeaways
- Cash advances charge an upfront fee of 3 to 5 percent plus a higher interest rate that starts when ready, making them expensive compared to regular purchases.
- You can withdraw cash at any ATM using your credit card PIN, or ask a bank teller for a cash advance over the counter.
- Interest on a cash advance begins the day you withdraw it, with no grace period, so the longer you carry the balance the more you pay.
- Alternatives like a personal loan, payday loan, or borrowing from family are often cheaper, depending on your credit and the amount you need.
How much a cash advance actually costs
The total cost of a cash advance has three parts: the upfront fee, the interest rate, and how long you carry the balance.
The upfront fee is usually 3 to 5 percent of the amount withdrawn. If you take out $500, you pay $15 to $25 just to get the cash. Some cards charge a flat fee instead (like $10) if the percentage would be smaller, so a $100 withdrawal might cost $10 flat rather than $3.
The interest rate on a cash advance is typically 2 to 5 percentage points higher than your purchase APR. If your regular APR is 18 percent, your cash advance APR might be 23 percent. That rate applies from day one — there is no 21-day grace period like there is for purchases. If you withdraw $500 and pay it back in 30 days, you owe roughly $30 in interest on top of the $15 to $25 fee.
Over a longer period, the cost compounds. Carry a $500 cash advance for six months at 23 percent APR and you pay about $57 in interest alone, plus the original fee. The total cost is now $72 to $82 — roughly 14 to 16 percent of what you borrowed.
Where to get a cash advance
You have two main options: an ATM or a bank branch.
At an ATM, insert your credit card and enter your PIN. The machine will ask how much you want to withdraw. The ATM may charge its own fee on top of your card's fee — usually $2 to $3 — if it is not owned by your card issuer's bank. Your credit card company will charge their fee separately when the transaction posts.
At a bank branch, walk in with your credit card and ask the teller for a cash advance. You can withdraw larger amounts this way than most ATMs allow. The teller will process it on the spot, and you will pay the same fees as an ATM withdrawal. Some banks waive their own ATM fee if you use a teller, but your card issuer's fee still applies.
Check your card's terms or call the number on the back to find out your cash advance limit. It is often lower than your credit limit — sometimes 20 to 50 percent of it — and it is a separate limit from your purchase limit.
Why cash advances are expensive compared to other borrowing
A cash advance is one of the most expensive ways to borrow money. The upfront fee plus the high interest rate make it costlier than most alternatives.
A personal loan from a bank or credit union usually has a lower APR (often 6 to 36 percent depending on your credit) and no upfront fee. If you have decent credit, a personal loan for $500 might cost you $20 to $40 in interest over six months — less than half what a cash advance costs.
A payday loan is faster but often more expensive than a cash advance, so it is not a better choice. Borrowing from family or friends, if that is an option, costs nothing. A line of credit from your bank, if you have one, usually has a lower rate than a cash advance.
The only time a cash advance makes sense is when you need cash when ready and have no other option. Even then, pay it back as fast as you can to minimize interest.
How a cash advance affects your credit score
A cash advance does not hurt your credit score directly — it is just another use of your credit limit. However, it can hurt your score indirectly if it raises your credit utilization ratio.
Your credit utilization is the percentage of your total credit limit that you are using across all cards. If you have a $5,000 limit and you carry a $1,500 balance, your utilization is 30 percent. A cash advance of $500 raises that to 40 percent. High utilization (above 30 percent) signals risk to lenders and can lower your score by a few points.
The bigger risk is if you cannot pay back the cash advance quickly. Missed payments or a growing balance will damage your score much more than the advance itself. Pay it off within a month or two if you can, and your score will recover.
How to avoid needing a cash advance
The best strategy is to keep cash on hand or in a savings account so you do not have to borrow it at high rates.
Set aside a small emergency fund — even $500 to $1,000 — in a separate savings account. When you need cash, withdraw from savings instead of your credit card. You earn a little interest on savings (currently 4 to 5 percent at many online banks) instead of paying interest on debt.
If you do not have savings yet, start small. Move $25 or $50 from each paycheck into a savings account. After a few months, you will have enough to cover a small emergency without borrowing.
If you are in a situation where you regularly need cash advances, that is a sign your income and expenses are out of balance. Consider talking to a credit counselor — many nonprofits offer free sessions — to work out a budget that covers your needs without relying on high-cost borrowing.
Frequently Asked Questions
Can I use a credit card to withdraw cash from any ATM?
Yes, you can use your card at any ATM that displays your card network's logo (Visa, Mastercard, etc.). However, out-of-network ATMs charge their own fee on top of your card issuer's fee. Using an ATM owned by your card issuer's bank is free of the ATM operator's fee, though your card issuer's cash advance fee still applies.
What is the difference between a cash advance and a balance transfer?
A cash advance is money you withdraw as cash; a balance transfer is moving debt from one card to another. A balance transfer often has a lower fee and APR, especially if you transfer to a card with a promotional 0 percent offer. Use a balance transfer to move existing debt; use a cash advance only if you need actual cash.
Will my credit card company let me take out my full credit limit as cash?
No. Most cards set a separate cash advance limit that is lower than your credit limit — often 20 to 50 percent of it. Call the number on your card or log into your account online to find your cash advance limit before you try to withdraw.
How long do I have to pay back a cash advance?
There is no set important date, but interest accrues every day you carry the balance. The longer you wait, the more you pay. Treat it like any other credit card balance and pay it off as soon as you can. Most people should aim to pay it back within one or two months.
Is there a way to get cash without paying a fee?
Yes. Withdraw from your own bank account or savings account for free. If you need cash from a credit card, there is no way to avoid the fee — it is built into how cash advances work. That is why having an emergency fund in savings is cheaper than relying on credit card cash advances.