Yes, you can withdraw cash from a credit card, but it is not the same as using the card to buy something
Taking cash off a credit card is called a cash advance. You go to an ATM, a bank teller, or a convenience store and withdraw money using your credit card, just as you would with a debit card. The money goes into your wallet as cash. But the card issuer charges you fees and interest on that cash right away — often much higher than the interest on regular purchases — and the interest starts accruing when ready, with no grace period.
Most people should avoid cash advances unless they have no other option. The cost adds up fast, and you are borrowing at the card's worst terms. But if you need cash urgently and have no other way to get it, knowing how cash advances work will help you understand what you are paying for.
Key Takeaways
- A cash advance charges a fee (usually 3 to 5 percent of the amount) plus a higher interest rate than regular purchases, starting when ready with no grace period.
- You can withdraw cash at an ATM, bank branch, or convenience store using your credit card, but the card issuer must support cash advances on your account.
- Interest on a cash advance accrues daily from the moment you withdraw it, so the longer you carry the balance, the more you pay.
- Paying off a cash advance should be your first priority because the interest rate is usually the highest rate on your card.
Where and how to withdraw cash using your credit card
You can take a cash advance at three types of locations. An ATM is the most common — insert your credit card, enter your PIN, and withdraw cash up to your daily limit. A bank branch (yours or another bank) lets you ask a teller to process a cash advance; bring your card and ID. A convenience store or grocery store may also offer cash advances at the register, though this is less common and depends on the store's agreement with your card issuer.
Before you try any of these, check whether your card issuer allows cash advances on your account. Not all cards do. Call the number on the back of your card or log into your online account to confirm. If cash advances are allowed, the issuer will tell you your cash advance limit — this is often lower than your credit limit and may be as low as $500 or $1,000 on some cards.
You will need your PIN to withdraw cash at an ATM. If you do not have one, contact your card issuer to set one up before you need the cash. At a bank branch or store, you may be able to use your card without a PIN, but you will need to show ID.
The fees and interest rates you will pay
A cash advance costs you money in two ways: an upfront fee and interest that starts right away. The cash advance fee is usually 3 to 5 percent of the amount you withdraw, though some cards charge a flat fee (like $10) instead. If you withdraw $500, expect to pay $15 to $25 just to get the cash.
The interest rate on a cash advance is almost always higher than the rate on regular purchases. While a purchase might carry an APR of 18 percent, a cash advance on the same card might be 25 percent or higher. This rate varies by card issuer and your creditworthiness, so check your card's terms to see what rate applies to cash advances.
Unlike a purchase, interest on a cash advance starts accruing the day you withdraw it. There is no grace period. If you withdraw $500 at a 25 percent APR, you are paying roughly $3.42 in interest per day. If you carry that balance for a month, you owe about $102 in interest alone, on top of the original $15 to $25 fee.
How a cash advance affects your credit and your account
A cash advance counts as a balance on your credit card, just like a purchase does. It uses up part of your available credit and shows on your credit report as an outstanding balance. If your cash advance balance is high relative to your credit limit, it can lower your credit score because it raises your credit utilization ratio.
The cash advance balance is separate from any purchase balance you carry. If you make a payment, the card issuer applies it to whichever balance has the highest interest rate first — usually the cash advance. But if you only pay the minimum, both balances will grow because interest accrues on both.
Some card issuers also report cash advances differently to credit bureaus, flagging them as higher-risk borrowing. This does not directly hurt your score, but it is another reason to pay off a cash advance as quickly as you can.
When to use a cash advance and when to avoid it
A cash advance makes sense only in narrow situations. If you need cash for an emergency and have no other way to get it — no savings, no friends or family to borrow from, no personal loan option — then a cash advance is better than nothing. But even then, plan to pay it back within days or weeks, not months.
Do not use a cash advance for everyday expenses, to fund a purchase you cannot otherwise afford, or to move money between accounts. The fees and interest are too high. If you need cash regularly, open a checking account with a debit card instead. If you need a short-term loan, look into a personal loan or a credit union loan, both of which usually have lower rates than a cash advance.
If your card does not allow cash advances, that is often a sign that the issuer considers them risky. Respect that signal. The fact that you cannot take a cash advance on a particular card may mean you should not be taking one at all.
How to pay off a cash advance quickly
Once you have taken a cash advance, your goal is to pay it off before the interest compounds. Make a payment as soon as you can — ideally within a few days. Every dollar you pay reduces the balance and stops interest from accruing on that portion.
If you have multiple balances on your card, ask your issuer how payments are applied. Most cards explore payments to the highest-interest balance first, which is usually the cash advance. But confirm this before you pay, so you know your money is going to the right place.
Do not just make the minimum payment. The minimum is designed to keep you in debt as long as possible. If you took a $500 cash advance and the minimum payment is $25, paying only the minimum will take you months to pay off and cost you hundreds in interest. Pay as much as you can afford each month until the cash advance is gone.
Alternatives to a cash advance
Before you take a cash advance, explore other options. If you need cash for an emergency, ask family or friends for a short-term loan. If you need cash for a specific purchase, use your credit card to buy the item instead — you will pay the lower purchase rate, not the cash advance rate. If you need ongoing access to cash, open a checking account with a debit card or a savings account that offers ATM access.
If you are in a tight financial spot and need cash regularly, a personal loan from a bank or credit union is almost always cheaper than a cash advance. Personal loans have fixed rates, fixed terms, and no daily interest accrual. A line of credit from a bank also costs less than a cash advance and gives you flexibility to borrow only what you need.
If your credit card issuer is refusing to let you take a cash advance, that is a useful signal. It means the issuer thinks you are at risk of not paying it back. Listen to that warning and find another way to solve the problem.
Frequently Asked Questions
Can I use a credit card to withdraw cash at any ATM?
Not every ATM accepts credit cards for cash advances. ATMs owned by your card issuer's bank usually do. ATMs at other banks may charge an additional fee on top of the cash advance fee. Convenience store and grocery store ATMs are less likely to accept credit cards. Call your card issuer or check their website to find ATMs that accept your card for cash advances.
What is the difference between a cash advance and a balance transfer?
A cash advance is cash you withdraw and take with you. A balance transfer is moving debt from one card to another card. Both charge fees and interest, but a balance transfer sometimes offers a lower introductory rate for a set period. A cash advance charges the full rate from day one. If you need cash, a cash advance is your only option. If you are moving existing debt, a balance transfer may be cheaper.
Does taking a cash advance hurt my credit score?
A cash advance itself does not hurt your score, but carrying a high cash advance balance does. It raises your credit utilization ratio, which can lower your score. The impact is temporary — once you pay off the balance, your utilization drops and your score recovers. But while you carry the balance, your score may dip.
What happens if I cannot pay back a cash advance?
If you do not pay, the balance stays on your card and interest keeps accruing. Your card issuer may raise your interest rate or lower your credit limit. The unpaid balance will show on your credit report and damage your credit score. After several months of non-payment, the issuer may close your account or send the debt to a collection agency.
Can I take a cash advance on a secured credit card?
Some secured cards allow cash advances, but not all. Check your card's terms or call the issuer to confirm. If your secured card does allow cash advances, the same fees and interest rates explore as with any other card. The cash advance limit may be lower than your credit limit.