You can pull money off a credit card through a cash advance, but it costs more than a regular purchase and starts charging interest when ready
A cash advance is a withdrawal of cash using your credit card at an ATM, bank teller, or through a convenience check. The money goes into your bank account or your pocket, not toward a purchase. Unlike a regular credit card purchase, a cash advance charges a fee upfront (usually 3 to 5 percent of the amount withdrawn) and begins accruing interest the same day — there is no grace period. If you need cash urgently, it works. If you are looking for cheap money, it is one of the most expensive ways to borrow.
The three main methods are ATM withdrawals, bank teller withdrawals, and convenience checks mailed by your card issuer. Each has different limits and fees. Your card issuer sets a separate cash advance limit, which may be lower than your credit limit. For example, you might have a $5,000 credit limit but only a $1,000 cash advance limit.
Key Takeaways
- Cash advances charge an upfront fee (typically 3 to 5 percent) plus interest that starts accruing when ready, with no grace period like regular purchases have.
- Your cash advance limit is usually lower than your credit limit and is set separately by your card issuer.
- ATM withdrawals are the fastest method but often have the lowest per-transaction limits; bank tellers can withdraw larger amounts in one transaction.
- The total cost of a cash advance depends on how long you carry the balance, so paying it back quickly reduces the interest you owe.
- Alternatives like personal loans, payday loans, or borrowing from family may be cheaper depending on your credit and the amount you need.
How cash advances work at an ATM
Using your credit card at an ATM is the fastest way to get cash. You insert your card, enter your PIN (which you may need to set up if you have never done a cash advance before), and withdraw the amount you need. The transaction posts to your credit card account within one to three business days.
ATM cash advances typically have a lower per-transaction limit than bank teller withdrawals — often $200 to $500 per transaction, though this varies by card issuer. If you need more, you can make multiple withdrawals, but each one incurs a separate fee. The fee is charged when ready, even if you pay back the cash advance within days.
Withdrawing cash at a bank teller
Walking into a bank branch and asking a teller for a cash advance usually allows you to withdraw a larger amount in a single transaction than an ATM. You will need your credit card and a photo ID. The teller will process the withdrawal and give you cash on the spot.
Bank teller withdrawals are subject to the same fees and interest rates as ATM withdrawals, but they are useful if you need a larger sum and want to avoid multiple ATM transactions and multiple fees. Not all banks process credit card cash advances at the teller window — call ahead to confirm your card issuer's policy.
Understanding the fees and interest rates
A cash advance fee is charged as a percentage of the amount withdrawn, typically 3 to 5 percent. On a $500 withdrawal, that is $15 to $25 in fees alone. Some card issuers cap the fee at a flat amount (for example, $10 minimum, $50 maximum), so a very small withdrawal might hit the minimum, and a very large one might hit the cap.
The interest rate on a cash advance is almost always higher than the purchase APR on the same card. While a purchase might carry a 15 percent APR, a cash advance might be 20 to 25 percent or higher. Interest accrues daily from the moment you withdraw the cash, with no grace period. If you carry a $500 cash advance at 22 percent APR for 30 days, you owe roughly $9 in interest on top of the $15 to $25 fee.
The longer you carry the balance, the more interest compounds. Paying back a cash advance within a week or two is much cheaper than carrying it for months. If you need cash for more than a few weeks, a personal loan or line of credit will almost always be cheaper.
Convenience checks and other methods
Some credit card issuers mail convenience checks to cardholders. These checks draw against your credit line and are treated as cash advances. You write a check to yourself or to someone else, deposit it, and the amount is added to your credit card balance. Convenience checks carry the same fees and interest rates as ATM or teller withdrawals.
Convenience checks are useful if you need to pay a bill or a person who does not accept credit cards, but they are slower than an ATM (they take days to clear) and offer no advantage in cost. Treat them the same way you would an ATM cash advance: use them only when you need cash urgently and plan to pay the balance back quickly.
When a cash advance makes sense
A cash advance is worth considering when you need cash urgently and have no other option, and you can pay it back within a week or two. Examples include an unexpected car repair that requires cash payment, or a medical bill that a provider will not accept by card.
A cash advance does not make sense if you are trying to move a balance from one card to another (use a balance transfer instead, which has lower fees), if you need the money for more than a few weeks (a personal loan is cheaper), or if you are considering it to fund a purchase you cannot otherwise afford (this is a sign to pause and reassess your budget).
Cheaper alternatives to a cash advance
A personal loan from a bank or credit union typically charges 6 to 36 percent APR with no upfront fee, making it cheaper than a cash advance for any amount you will carry for more than a few days. If you have decent credit, a personal loan is usually the better choice.
A balance transfer to a new card with a 0 percent introductory APR can be useful if you are moving debt from one card to another, though balance transfers also charge a fee (usually 3 to 5 percent) and the 0 percent period is temporary (typically 6 to 21 months).
Borrowing from family or friends, if the relationship allows, costs nothing. A payday loan is another option but is usually more expensive than a cash advance and should be avoided if possible. A line of credit from a bank or credit union, if you have one, typically charges less interest than a cash advance.
Frequently Asked Questions
Does a cash advance hurt my credit score?
A cash advance itself does not directly hurt your score, but it increases your credit utilization (the amount of your available credit you are using), which can lower your score slightly. Paying it back quickly brings your utilization back down. Missing payments on a cash advance will hurt your score significantly.
Can I get a cash advance with a debit card?
No. A debit card draws from your bank account directly, so there is no borrowing involved. You can withdraw cash from an ATM using a debit card, but that is not a cash advance — you are straightforward accessing your own money. A cash advance is only available with a credit card.
What happens if I cannot pay back a cash advance?
The balance stays on your credit card and accrues interest. If you miss payments, your card issuer will charge late fees and may raise your interest rate. The debt can be reported to credit bureaus and damage your credit score. Contact your card issuer if you are struggling to pay; some offer hardship programs or payment plans.
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 usually lower than your overall credit limit. You can contact your issuer to ask what your cash advance limit is, or check your card's terms and conditions. Some issuers allow you to request an increase, though this is not may provide.
Can I use a cash advance to pay off another credit card?
Technically yes, but it is not a good idea. You would be paying a cash advance fee and interest rate to move debt from one card to another. A balance transfer (moving the balance directly from one card to another) is cheaper because the fee is the same but the interest rate is often lower, and many balance transfer offers include a 0 percent introductory period.