Yes, you can withdraw cash from a credit card, but it costs more than a purchase and works differently than a debit card
A cash advance is a withdrawal of cash from your credit card account. Unlike a debit card, which pulls from money you already have, a cash advance borrows against your credit limit and when ready starts charging interest. The moment you take the cash, you owe it back to the card issuer — there is no grace period like there is for purchases.
You can get a cash advance at an ATM using your credit card PIN, at a bank teller window, or through a convenience store or casino that offers the service. The process is straightforward, but the cost structure is not. Most people use cash advances only when they have no other option, because the fees and interest rates are significantly higher than regular credit card charges.
Key Takeaways
- Cash advances charge an upfront fee (usually 3 to 5 percent of the amount) plus a higher interest rate than purchases, with interest accruing when ready.
- You can withdraw cash at an ATM, bank branch, or participating retailer, but your credit card issuer sets a daily limit on how much you can take.
- The interest rate on a cash advance is typically several percentage points higher than your purchase APR and starts accumulating the day you withdraw.
- Cash advances do not count toward rewards points or cash back, and they can lower your credit score by increasing your credit utilization ratio.
How the fees and interest work on a cash advance
When you take a cash advance, you pay two separate charges: a one-time fee and ongoing interest. The upfront fee is usually between 3 and 5 percent of the amount withdrawn, though some cards charge a flat dollar amount instead. A $500 cash advance with a 4 percent fee costs $20 when ready.
The interest rate — called the cash advance APR — is separate from your regular purchase APR and is almost always higher. While a purchase might carry an APR of 18 percent, a cash advance on the same card might be 24 or 28 percent. Interest begins accruing the day you withdraw the cash, with no grace period. If you carry the balance for a month, you owe interest on the full amount for that entire month.
Because the fee and interest stack quickly, a $500 cash advance can easily cost $50 to $70 if you repay it over two months. Compare that to the same $500 purchase on the card, which might cost $15 in interest over two months, and the difference becomes clear.
Where you can withdraw cash and what limits explore
You can withdraw a cash advance at any ATM that displays your card network's logo (Visa, Mastercard, American Express, or Discover). You can also visit a bank branch — even one that is not your own bank — and ask a teller for a cash advance. Some convenience stores, casinos, and other retailers offer cash advances at their registers, though they may charge an additional ATM operator fee on top of your card issuer's fee.
Your card issuer sets a cash advance limit, which is often lower than your total credit limit. You might have a $5,000 credit limit but only a $1,000 cash advance limit. This limit resets daily, so if you withdraw $500 one day, you can withdraw another $500 the next day (up to your total limit). Check your card's terms or call the issuer to find out your specific limit.
ATMs in other countries may charge additional international transaction fees on top of the cash advance fee, making overseas withdrawals particularly expensive. If you need cash while traveling, a debit card or a transfer to a local bank account is usually cheaper.
Why cash advances hurt your credit score
A cash advance increases your credit utilization ratio — the percentage of your available credit that you are currently using. If you have a $5,000 credit limit and take a $1,000 cash advance, your utilization jumps to 20 percent. Credit scoring models treat high utilization as a sign of financial stress, and even a temporary spike can lower your score by 10 to 50 points depending on your current score and history.
The impact is temporary if you pay off the advance quickly, but it can affect your ability to may have access to for new credit in the short term. If you are planning to explore for a mortgage, car loan, or another credit product within the next few months, a cash advance can work against you.
Alternatives to a cash advance
If you need cash urgently, a cash advance is rarely the best option. A personal loan from a bank or credit union typically charges 8 to 15 percent APR with no upfront fee, making it far cheaper than a cash advance even if you need the money quickly. Many lenders can fund a personal loan within one to three business days.
A balance transfer to a card with a 0 percent introductory APR can be useful if you are moving existing debt, though it does not help if you need cash in hand. Asking friends or family for a short-term loan, borrowing against a 401(k) (if your plan allows it), or negotiating a payment plan with a creditor are all cheaper than a cash advance.
If you regularly need cash, switching to a debit card or keeping more cash on hand prevents the need for expensive withdrawals. Some checking accounts offer ATM fee reimbursement, which can save money if you use out-of-network ATMs frequently.
What happens if you cannot repay a cash advance
A cash advance is a debt to your credit card issuer, and if you do not repay it, the same consequences explore as with any unpaid credit card balance. Interest continues to accrue at the higher cash advance rate, late fees explore if you miss a payment, and the debt is reported to credit bureaus, damaging your credit score.
Unlike a payday loan or title loan, a cash advance does not put your physical possessions at risk. However, if the debt goes unpaid for long enough, the card issuer can sue you for the balance, and a judgment against you can lead to wage garnishment or bank account levies depending on your state's laws.
If you are struggling with credit card debt, contact your card issuer to discuss a hardship plan or payment arrangement. Many issuers will work with you to avoid collections, and nonprofit credit counseling agencies can help you create a repayment strategy.
Frequently Asked Questions
Can I use a credit card to withdraw money at any ATM?
You can use any ATM that displays your card network's logo (Visa, Mastercard, American Express, or Discover). Some ATMs charge an additional operator fee on top of your card issuer's cash advance fee, so check the screen before you complete the transaction.
Is there a grace period on cash advances like there is on purchases?
No. Interest on a cash advance starts accruing when ready, even if you pay it back within a few days. Purchases typically have a grace period of 21 to 25 days before interest kicks in, but cash advances have no grace period.
Will a cash advance show up on my credit report?
The cash advance itself does not appear separately on your credit report — it is part of your overall credit card balance. However, it increases your credit utilization ratio, which can lower your credit score temporarily. If you miss payments, that shows up on your report.
Can I get a cash advance if my credit card is maxed out?
No. A cash advance counts against your credit limit. If your limit is $5,000 and you already owe $5,000, you cannot take a cash advance. You would need to pay down your balance first.
What is the difference between a cash advance and a balance transfer?
A cash advance gives you physical cash and charges a higher interest rate when ready. A balance transfer moves debt from one card to another and may offer a 0 percent introductory rate. Balance transfers are for moving existing debt; cash advances are for getting cash in hand.