Yes, you can get cash back on a credit card, but it costs you money and comes with limits
Most credit cards let you withdraw cash at an ATM or ask a cashier for cash back when you make a purchase. The catch: you pay a fee for the withdrawal, and the interest rate on that cash is usually higher than the rate on regular purchases. You also start paying interest when ready — there is no grace period like there is for regular card purchases. The amount you can withdraw is capped by your card issuer, often at $500 to $1,000 per day, though some cards allow more.
Cash advances are expensive and should be a last resort, not a regular way to get money. If you need cash regularly, a debit card or ATM withdrawal from your own bank account costs nothing. If you are considering a cash advance because you need money you do not have, that is a sign to look at your budget or talk to a financial counselor before taking on high-interest debt.
Key Takeaways
- Cash advances charge a fee (usually 3 to 5 percent of the amount) plus a higher interest rate than regular purchases, often 20 to 30 percent APR.
- Interest on a cash advance starts the day you withdraw it, with no grace period, so the cost adds up fast.
- Your card issuer sets a daily limit on how much cash you can withdraw, typically $500 to $1,000.
- You can get cash at an ATM using your credit card PIN, or ask a cashier for cash back at a store, but both methods charge fees.
- Using a cash advance should be rare; if you need cash regularly, a debit card or bank account withdrawal is free.
How to withdraw cash using your credit card
There are two main ways to get cash from a credit card. The first is to go to an ATM, insert your card, enter your PIN, and withdraw the amount you need. The second is to go to a store, make a purchase, and ask the cashier for cash back — though not all stores offer this option, and some charge a fee for it.
Before you try either method, check your card's terms to find out your daily cash advance limit. This limit is separate from your credit limit. You can find it in your cardholder agreement or by calling the number on the back of your card. Some cards also let you set your own limit through their mobile app or website.
If you do not know your PIN, you will need to set one before you can use an ATM. Most card issuers let you create a PIN online or by phone. This usually takes a few minutes.
What fees and interest rates you will pay
A cash advance typically costs you in three ways. First, there is an upfront fee, usually 3 to 5 percent of the amount you withdraw. On a $500 withdrawal, that is $15 to $25 right away. Second, the interest rate on cash advances is higher than the rate on regular purchases — often 20 to 30 percent APR or more, depending on your card and credit history. Third, interest starts accruing the moment you withdraw the cash, with no grace period.
To see the real cost, imagine you withdraw $500 at a 4 percent fee and 25 percent APR. You pay $20 in fees when ready. If you pay back the $500 in one month, you will also owe roughly $10 in interest. Total cost: $30 for borrowing $500 for a month. That is 72 percent APR in real terms — far higher than the stated rate because of the upfront fee.
Some cards offer a lower cash advance rate for a limited time if you are a new cardholder, but this is rare. Read your offer carefully to see whether it applies to cash advances or only to regular purchases.
Daily and monthly limits on cash withdrawals
Your card issuer sets a maximum amount you can withdraw in a single day, usually $500 to $1,000. Some premium cards allow $2,000 or more. This limit is not the same as your credit limit — you could have a $10,000 credit limit but only be able to withdraw $500 in cash per day.
There is also usually a monthly limit on total cash advances, though this is less common. If you hit your daily limit, you will have to wait until the next day to withdraw more. If you hit your monthly limit, you may not be able to withdraw any more cash until the next billing cycle.
You can often increase your daily limit by calling your card issuer and asking, though they may deny the request if your account is new or if you have missed payments. Some card issuers let you set your own limit through their app.
Cash back at the store versus ATM withdrawals
Asking for cash back at a store checkout is sometimes cheaper than using an ATM, because some stores do not charge a fee for it. However, not all stores offer cash back, and some charge a fee similar to what an ATM would charge — usually $1 to $3. You also have to make a purchase to get cash back, which defeats the purpose if you only need cash.
ATM withdrawals are straightforward: you go to an ATM, insert your card, enter your PIN, and take out cash. The fee is usually $2 to $5, depending on whether the ATM is in your card issuer's network. Out-of-network ATMs charge more. Your card issuer may also charge a separate fee on top of what the ATM operator charges.
Neither option is cheap. If you need cash regularly, it is worth switching to a bank account with a debit card and free ATM access, or using a checking account that reimburses ATM fees.
When a cash advance makes sense, and when it does not
A cash advance makes sense only in a genuine emergency when you have no other way to get cash and you can pay it back within a few days. Examples: your car breaks down and you need cash for a repair, or you are traveling and your debit card stops working. In these cases, the cost is worth it because you are paying interest for only a short time.
A cash advance does not make sense if you are using it to cover regular expenses, pay bills, or fund a purchase you cannot otherwise afford. If you are regularly short on cash, the problem is not that you need a cash advance — it is that your income does not cover your spending. Taking on high-interest debt makes that problem worse, not better.
If you are considering a cash advance because you are in financial trouble, talk to a nonprofit credit counselor first. Many offer free consultations and can help you understand your options. The National Foundation for Credit Counseling (NFCC) has a directory of counselors you can contact.
Alternatives to cash advances
Before you take a cash advance, consider these cheaper options. If you have a debit card linked to a bank account, use that to withdraw cash — there is no fee if you use your own bank's ATM, and many banks reimburse out-of-network fees. If you do not have a bank account, opening one is free and takes about 15 minutes online.
If you need cash for a specific purchase, ask the seller whether they take a credit card instead. Most do, and you will avoid the cash advance fee and interest. If you need cash for an emergency and do not have savings, a personal loan from a bank or credit union usually has a lower interest rate than a cash advance, though it takes longer to get approved.
If you are in a bind and need cash fast, a payday loan or title loan may seem tempting, but these are even more expensive than credit card cash advances — often 400 percent APR or higher. Avoid them if you can.
Frequently Asked Questions
Does getting cash back at a store count as a cash advance?
Yes, it does. Cash back at a store is treated the same way as an ATM withdrawal — you pay a fee and a higher interest rate, and interest starts accruing when ready. The only difference is that some stores do not charge a fee, which makes it slightly cheaper than an ATM if the store is fee-free.
Can I use a credit card to withdraw cash from another person's bank account?
No. A credit card cash advance only lets you withdraw cash from an ATM or get cash back at a store. You cannot transfer money to another account or withdraw cash from someone else's account.
What happens if I do not pay back a cash advance?
The unpaid balance stays on your credit card and you keep paying interest on it. If you do not pay your credit card bill, your card issuer can charge late fees, raise your interest rate, and report the missed payment to credit bureaus, which damages your credit score.
Is there a way to avoid the cash advance fee?
Some credit cards do not charge a cash advance fee, though these are rare and usually come with other trade-offs like a higher interest rate or annual fee. Check your cardholder agreement to see whether your card charges a fee. If it does and you need cash regularly, switching to a card without a cash advance fee might save you money.
Can I get a cash advance on a debit card?
No. Debit cards are linked to money you already have in your bank account, so there is no borrowing involved. You can withdraw cash from an ATM or get cash back at a store using a debit card, but there is no fee or interest because the money is yours.