Yes, you can withdraw cash from a credit card, but it works differently than a debit card and costs you money upfront
You can take cash out of an ATM using your credit card, but the transaction is not a regular purchase. Your card issuer treats it as a cash advance — a short-term loan against your credit limit. Unlike a purchase, a cash advance starts charging interest when ready, usually at a higher rate than your regular APR. You also pay a fee upfront, typically 3 to 5 percent of the amount you withdraw. If you need $200, you might pay $6 to $10 just to get it, plus daily interest from day one.
Most people use cash advances only when they have no other option — they need physical cash and cannot use their debit card or get to a bank. The cost adds up fast, so understanding how the process works and what you will pay helps you decide whether it is worth it in your situation.
Key Takeaways
- A cash advance charges you a fee (usually 3 to 5 percent) and a higher interest rate than regular purchases, with interest starting when ready.
- You withdraw cash at an ATM using your credit card PIN, and the amount counts against your available credit limit.
- The cash advance fee and interest appear on your next statement, and you owe them even if you pay off the advance quickly.
- Paying back a cash advance does not reduce the interest you owe on regular purchases — the two are tracked separately on your account.
- If you need cash regularly, a debit card or a small personal loan costs far less than repeated cash advances.
How a cash advance actually works
To withdraw cash, you go to an ATM that accepts your card, insert it, enter your PIN, and select the cash amount. The ATM dispenses the money, and your card issuer records the transaction as a cash advance on your account. The amount is deducted from your available credit — if you have a $2,000 limit and withdraw $300, you now have $1,700 left to spend.
The fee hits your account when ready. If your card charges a 4 percent cash advance fee and you withdraw $300, you owe $12 right away, added to your balance. Interest begins accruing the same day at your cash advance APR, which is often 2 to 5 percentage points higher than your purchase APR. If your purchase rate is 18 percent and your cash advance rate is 23 percent, you pay the higher rate on that $300 plus the $12 fee.
The cash advance appears on your next statement as a separate line item from your regular purchases. Some cards show the fee and the principal separately; others combine them. Either way, you owe both.
What the fees and interest actually cost you
The math is worth working through with a real example. Say you withdraw $500 at a 4 percent fee and 24 percent APR, and you pay it back in full on your next statement 30 days later.
The fee is $20 upfront. Interest for 30 days on $500 at 24 percent APR is roughly $10. You owe $530 total — $20 in fees and $10 in interest — just to borrow $500 for a month. That is a 6 percent cost for 30 days, or about 72 percent annualized. A personal loan from a bank or credit union would cost a fraction of that.
If you do not pay the full amount back, the interest compounds. Carry that $500 for three months and you owe roughly $30 in interest alone, plus the original $20 fee. The longer you carry it, the worse the math gets.
Cash advances and your credit card statement
When you receive your statement, the cash advance appears as its own transaction or group of transactions. You will see the principal amount, the fee, and the interest charged so far. The interest continues to accrue daily until you pay the balance to zero.
Here is the part that surprises many people: if you make a payment to your card, the payment is applied to your lowest-interest debt first. That means if you have a $500 cash advance at 24 percent and $1,000 in regular purchases at 18 percent, a $300 payment goes toward the purchases, not the cash advance. The cash advance keeps accruing interest at the higher rate while you pay down the cheaper debt. To stop the bleeding, you have to pay the cash advance balance in full.
Some cards let you request that payments go to the cash advance first, but you have to ask. Check your card's website or call the number on the back to learn about yours allows it.
Where you can withdraw cash and what limits explore
You can withdraw cash at any ATM that displays your card network's logo — Visa, Mastercard, American Express, or Discover. Most banks and credit unions allow cardholders from other institutions to use their ATMs, though some charge a small fee ($1 to $3) on top of your card issuer's cash advance fee.
Your card issuer sets a daily cash advance limit, which is usually lower than your credit limit. A card with a $5,000 credit limit might have a $500 daily cash advance limit. You can find your limit in your online account or by calling the number on your card. If you need more cash than your daily limit allows, you have to wait until the next day to withdraw more.
Some cards also set a monthly cash advance limit. If your card has a $500 daily limit and a $1,500 monthly limit, you can withdraw up to $500 per day but no more than $1,500 total in a calendar month.
Cheaper ways to get cash when you need it
If you need cash regularly, a credit card cash advance is one of the most expensive ways to get it. A few alternatives cost far less.
Use your debit card. If you have a checking account, your debit card lets you withdraw cash at ATMs and get cash back at stores with no fee and no interest. This is information programs compared to a cash advance.
Ask for cash back at a store. When you buy something with a debit card at a grocery store, pharmacy, or retailer, you can request cash back. The store gives you the amount in addition to your purchase, and it is deducted from your checking account. No fee, no interest.
Borrow from a credit union or bank. A small personal loan from a credit union or bank costs far less than a cash advance. A $500 loan at 12 percent APR costs roughly $6 in interest per month, compared to $10 for a cash advance at 24 percent. If you need cash regularly, a small line of credit or a personal loan is worth exploring.
Use a peer-to-peer payment app. If a friend or family member can lend you cash, apps like Venmo, PayPal, or Cash App let you transfer money when ready with no fees. You can withdraw the money at an ATM using your debit card.
When a cash advance might make sense
Cash advances are expensive, but there are rare situations where they are the only option. If you are in a true emergency — your car broke down and you need cash to pay a mechanic, or you are traveling and your debit card was lost — a cash advance might be worth the cost. The fee and interest are painful, but they are less painful than being stranded.
If you find yourself taking cash advances regularly, that is a sign your budget does not match your income. A cash advance is a loan, not information programs, and borrowing repeatedly at high interest rates is a path to deeper debt. If this is happening, it is worth talking to a credit counselor about your spending and income. Many nonprofits offer free counseling.
Frequently Asked Questions
Does a cash advance hurt my credit score?
A single cash advance does not directly hurt your score, but it increases your credit utilization — the percentage of your available credit you are using. If you have a $2,000 limit and a $500 cash advance, your utilization jumps to 25 percent. High utilization can lower your score slightly. The bigger risk is that cash advances often lead to carrying a balance, which costs interest and keeps your utilization high.
Can I use a credit card cash advance to pay off another debt?
Technically yes, but it is almost always 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. If you are paying off a personal loan at 10 percent with a cash advance at 24 percent, you are making your situation worse. The only exception is if the debt you are paying off has an even higher rate, like a payday loan.
What happens if I cannot pay back a cash advance?
The balance stays on your card and keeps accruing interest. If you do not pay, your card issuer will eventually report the debt to credit bureaus, which damages your credit score. They may also close your account and send the debt to a collection agency. If you are struggling to pay, contact your card issuer to ask about hardship programs — some offer lower interest rates or payment plans for customers in financial difficulty.
Is the cash advance fee the same as the interest rate?
No. The fee is a one-time charge (usually 3 to 5 percent) that you pay upfront. The interest rate is an annual percentage rate (APR) that accrues daily on the balance. You pay both. A $300 cash advance at a 4 percent fee and 24 percent APR costs $12 in fees plus daily interest.
Can I get a cash advance from a credit card without a PIN?
Most ATMs require a PIN to withdraw cash. If you do not have one, you can call your card issuer to set one up — it usually takes a few minutes. Some banks also let you withdraw cash at a branch with your card and ID, but this is less common with credit cards than with debit cards.