Yes, you can get cash from a credit card, but it costs more than a regular purchase
A cash advance lets you withdraw money from your credit card at an ATM, bank, or through a cash-back transaction at a store. The money comes from your available credit, not your checking account. You repay it like any other credit card balance — but the fees and interest rates are steeper than they are for regular purchases.
Most people use cash advances only when they have no other option, because the cost adds up fast. A typical cash advance charges a fee of 3 to 5 percent of the amount withdrawn, plus interest that starts accruing when ready — there is no grace period like there is for purchases. If you need cash, a personal loan, a line of credit, or even a payday loan from a credit union often costs less.
Key Takeaways
- Cash advances charge an upfront fee (usually 3 to 5 percent) plus interest that begins right away, with no grace period.
- You can withdraw cash at an ATM using your PIN, at a bank teller window with your card and ID, or get cash back at a store during a debit transaction.
- The interest rate on a cash advance is typically higher than the rate on purchases, and both the fee and interest appear on your next statement.
- Paying off a cash advance should be your priority, because the interest compounds daily until the balance is zero.
- If you need cash regularly, a personal line of credit or credit union loan will cost you less over time.
Three ways to withdraw cash from your credit card
The method you choose depends on where you are and how much cash you need. All three routes charge the same fee and interest rate — the difference is just convenience.
ATM withdrawal: Insert your credit card into any ATM, enter your PIN, and select "cash advance" or "withdraw cash." The ATM will show you the fee before you confirm. You can withdraw up to your available credit, though many cards set a daily limit (often $500 to $1,000). The money appears in your account when ready, but the fee and interest post to your credit card statement within one to three business days.
Bank teller: Walk into any bank branch — it does not have to be your bank — with your credit card and a photo ID. Tell the teller you want a cash advance. They will process it the same way an ATM does, and you will see the fee right away. This method works if you do not have a PIN or prefer to speak to a person.
Cash back at a store: During a debit transaction, you can ask the cashier for cash back using your credit card. This does not charge a cash advance fee — it is treated as a purchase. However, most stores limit cash back to $20 to $100, so this only works for small amounts. You still pay interest on the amount, but you avoid the upfront fee.
What the fees and interest actually cost
A cash advance on a $500 withdrawal illustrates the real cost. If your card charges a 4 percent fee, you pay $20 upfront. If the cash advance interest rate is 24 percent annual rate and you take one month to repay it, you owe roughly $10 in interest. Total cost: $30, or 6 percent of what you borrowed.
The longer you carry the balance, the worse it gets. If you take three months to repay that same $500, interest alone will be around $30, bringing your total cost to $50. Credit card companies calculate interest daily, so every day you carry a balance, the interest grows.
Compare this to a personal loan from a bank or credit union, which might charge 8 to 12 percent annual interest with no upfront fee. On a $500 loan repaid over three months, you would pay roughly $10 in interest — one-fifth of what a cash advance costs. Even a payday loan, which has a bad reputation, often costs less than a credit card cash advance if you repay it on time.
How cash advances affect your credit score
A cash advance does not hurt your credit score directly — it is not reported separately to the credit bureaus. However, it does increase your credit card balance, which raises your credit utilization ratio (the percentage of your available credit you are using). If you normally use 20 percent of your limit and a $500 cash advance pushes you to 50 percent, your score may drop by a few points.
The bigger risk is missing a payment. Cash advances carry the same payment important date as regular purchases, and a missed payment will damage your score far more than the utilization increase. Set a reminder to pay the balance as soon as you can.
Why paying off a cash advance should be your first priority
If you carry multiple balances on your credit card — some from purchases, some from a cash advance — the card issuer applies your payment to the lowest-interest balance first (usually purchases). This means your cash advance balance sits there accruing interest at the higher rate while you pay down cheaper debt.
To avoid this trap, pay more than the minimum and direct the extra payment toward the cash advance. Call your card issuer or log into your account to see if you can earmark a payment for the cash advance specifically. If not, pay down the entire balance as fast as you can so the cash advance is gone first.
Alternatives that cost less
Before you use a cash advance, explore these options:
- Personal loan from a bank or credit union: Fixed interest rate, no upfront fee, and repayment terms of 12 to 60 months. Rates typically range from 6 to 36 percent depending on your credit score.
- Line of credit: A revolving account similar to a credit card but with lower interest rates. You pay interest only on what you draw.
- Borrow from friends or family: No fee, no interest, and no credit check — but put the terms in writing to avoid misunderstandings.
- Paycheck advance from your employer: Some employers offer advances on your next paycheck with no fee. Ask your HR department.
- Credit union payday loan: Capped at $1,000 and limited to a 1 percent fee, these are far cheaper than credit card cash advances or payday lenders.
What happens if you cannot pay back the cash advance
If you cannot repay the cash advance, it becomes part of your credit card debt. The interest keeps compounding, and if you miss a payment, your card issuer will charge a late fee (usually $25 to $40) and may raise your interest rate. After 30 days of missed payments, the issuer will report the delinquency to the credit bureaus, which will lower your score.
If the debt goes unpaid for six months, the issuer may close your account and send the debt to a collection agency. At that point, you may face lawsuits or wage garnishment depending on your state. If you are struggling to repay, contact your card issuer when ready — many offer hardship programs that lower your interest rate or pause payments temporarily.
Frequently Asked Questions
Is there a limit to how much I can withdraw as a cash advance?
Yes. Your card issuer sets a cash advance limit, which is often lower than your overall credit limit — sometimes 20 to 50 percent of it. You can find your limit in your cardholder agreement or by calling the number on the back of your card. ATMs also have daily withdrawal limits, typically $500 to $1,000.
Do I have to pay interest on a cash advance right away?
Yes. Unlike purchases, which have a grace period of 20 to 25 days before interest kicks in, cash advances start accruing interest the moment you withdraw the money. There is no grace period, so the sooner you repay it, the less interest you pay.
Can I use a cash advance to pay off another debt?
Technically yes, but it is usually a bad idea. You are borrowing at a high interest rate (the cash advance rate) to pay off debt that might have a lower rate. The only exception is if you are paying off a payday loan or other predatory debt at an even higher rate — in that case, a cash advance might be the lesser evil.
What if my credit card does not have a PIN?
You can still get a cash advance at a bank teller by showing your card and ID. You cannot use an ATM without a PIN, so you would need to call your card issuer to request one, which usually takes three to five business days.
Does getting cash back at a store count as a cash advance?
No. Cash back is treated as a purchase, not a cash advance, so you avoid the upfront fee. However, you still pay interest on the amount, and most stores limit cash back to $20 to $100 per transaction.