Yes, you can get cash with a credit card, but it costs more than a regular purchase and comes with higher interest rates
A cash advance is a short-term loan against your credit card's available balance. You walk into a bank or ATM, request cash, and the card issuer sends it to you — usually within minutes. The transaction appears on your statement as a cash advance, not a purchase, which triggers different fees and interest rules.
The catch is when ready: cash advances charge an upfront fee (typically 3 to 5 percent of the amount you withdraw), and interest starts accruing the same day with no grace period. If you borrow $500, you might pay $15 to $25 just to get the cash, then pay interest on the full $500 from day one. For comparison, a regular purchase usually has a 21-day grace period before interest kicks in.
This makes cash advances expensive for anything but genuine emergencies. If you need cash for a few days, the cost is manageable. If you need it for weeks or months, you are paying significantly more than you would with a personal loan or line of credit.
Key Takeaways
- Cash advances charge an upfront fee of 3 to 5 percent plus interest that starts when ready, making them one of the most expensive ways to borrow against a credit card.
- You can withdraw cash at ATMs, bank branches, or through a convenience check, each with slightly different fees and limits.
- Most cards set a cash advance limit that is lower than your credit limit, often 20 to 50 percent of what you can spend on purchases.
- The interest rate on cash advances is usually higher than your purchase rate and does not benefit from any grace period.
- For amounts you need for more than a week or two, a personal loan or credit line will cost significantly less.
Three ways to get cash from your credit card
The most common method is an ATM withdrawal. You insert your card, enter your PIN, and withdraw cash up to your daily limit. The fee is usually $3 to $5 per transaction, plus your card issuer may charge an additional cash advance fee of 3 to 5 percent of the amount withdrawn.
A second option is visiting a bank branch in person. You can ask a teller to process a cash advance directly from your credit card account. The fee structure is the same as an ATM, but you avoid the daily withdrawal limit that ATMs often impose — you can sometimes withdraw larger amounts this way.
A third method is a convenience check — a blank check your card issuer sends you that draws against your credit line. You write the check to yourself, deposit it in your bank account, and the amount becomes a cash advance. This is useful if you need to move money between accounts or pay someone who will not accept a card, but the fees are identical to ATM withdrawals.
Cash advance fees and interest rates explained
When you take a cash advance, you pay two separate costs: a transaction fee and interest.
The transaction fee is charged once, at the time of withdrawal. It is typically 3 to 5 percent of the amount you withdraw, with a minimum fee of $5 to $10. If you withdraw $200, you might pay $6 to $10. If you withdraw $1,000, you might pay $30 to $50. This fee is added to your balance when ready.
Interest begins accruing the same day you withdraw the cash. There is no grace period. If your purchase APR is 18 percent and your cash advance APR is 22 percent (which is common), you are paying the higher rate from day one. On a $500 advance at 22 percent APR, you owe roughly $3 in interest per day until you pay it back.
The interest compounds daily, so the longer you carry the balance, the more you owe. A $500 cash advance at 22 percent APR costs about $90 in interest if you pay it back in 30 days, and about $180 if you carry it for 60 days.
Cash advance limits and how they work
Your card issuer sets a separate cash advance limit that is usually lower than your overall credit limit. If your credit limit is $5,000, your cash advance limit might be $1,000 or $2,500. You cannot exceed this limit, even if you have unused credit available.
The limit exists because cash advances are riskier for the issuer — they are unsecured loans with no collateral, and the issuer has less control over how the money is used. You can check your cash advance limit by logging into your online account, calling the card issuer, or reviewing your cardholder agreement.
Some cards also impose a daily withdrawal limit at ATMs, separate from your cash advance limit. You might have a $2,000 cash advance limit but only be able to withdraw $500 per day from an ATM. Bank branches usually allow larger single withdrawals.
When a cash advance makes sense
A cash advance is reasonable when you need cash for a genuine short-term emergency and have no other option. Examples include a car repair you must pay in cash, a medical bill due when ready, or a travel situation where your debit card is lost and you need cash to get home.
In these cases, the fee and interest are a cost of solving the problem quickly. If you can pay back the advance within a week or two, the total interest cost stays low — under $20 or $30 for most amounts.
A cash advance makes less sense if you need the money for longer than two weeks, or if you have other options available. A personal loan from a bank or credit union, a line of credit, or even a short-term loan from family will cost less over time. A personal loan might charge 8 to 12 percent APR with no upfront fee, which is far cheaper than a 22 percent cash advance with a 5 percent transaction fee.
How cash advances affect your credit score
Taking a cash advance does not directly damage your credit score, but it can indirectly affect it in two ways.
First, the cash advance increases your credit utilization — the percentage of your available credit you are using. If you have a $5,000 limit and take a $1,000 cash advance, your utilization jumps to 20 percent. High utilization (above 30 percent) can lower your score slightly. Once you pay back the advance, utilization drops and your score recovers.
Second, if you carry the cash advance balance for months and miss payments, that will damage your score. The damage comes from the missed payment itself, not from the cash advance feature. If you pay on time, your score is not harmed beyond the temporary utilization effect.
Alternatives to cash advances
Before taking a cash advance, consider these lower-cost options:
- Debit card withdrawal: If you have a debit card linked to a checking account with funds available, use that instead. There is no fee and no interest.
- Personal loan: Banks and credit unions offer personal loans at 8 to 15 percent APR with no upfront fee. The interest is lower than a cash advance, and you have a fixed repayment schedule.
- Credit line: If you have a home equity line of credit or personal line of credit, the interest rate is usually lower than a cash advance.
- Paycheck advance: Some employers offer paycheck advances or emergency loans to employees at no cost or low cost.
- Peer-to-peer lending: Platforms like LendingClub or Prosper offer personal loans at rates competitive with banks, sometimes with faster approval.
- Asking for help: If the amount is small and you have family or friends who can lend, a personal loan from them costs nothing.
Frequently Asked Questions
What is the difference between a cash advance and a regular credit card purchase?
A purchase has a grace period (usually 21 days) before interest starts, while a cash advance charges interest from day one. A purchase has no upfront fee, while a cash advance charges 3 to 5 percent. The interest rate on a cash advance is also usually higher than the purchase rate.
Can I use a cash advance to pay off another credit card?
Technically yes, but it is expensive. You would pay the cash advance fee and interest rate on the amount transferred. A balance transfer card, which offers 0 percent APR for 6 to 21 months with a 3 to 5 percent transfer fee, is usually cheaper if you are moving debt between cards.
What happens if I do not pay back a cash advance?
The balance stays on your credit card and interest continues to accrue daily. If you do not pay at least the minimum payment, your account goes past due, your credit score drops, and the card issuer may increase your interest rate or close your account. After 180 days of non-payment, the issuer may charge off the debt and sell it to a collection agency.
Does taking a cash advance hurt my credit score when ready?
Not when ready. The cash advance itself does not trigger a hard inquiry or appear as a negative mark. However, it increases your credit utilization, which can lower your score by a few points. Once you pay it back, utilization drops and your score recovers.
Can I get a cash advance from any credit card?
Most credit cards allow cash advances, but some do not — certain secured cards or cards designed for rebuilding credit may not offer this feature. Check your cardholder agreement or call your issuer to confirm your card has a cash advance option and what your limit is.