You can withdraw cash from a credit card, but it costs more than a regular purchase
A cash advance is a withdrawal of cash from your credit card account. Unlike a debit card, which pulls from money you already have, a cash advance borrows against your credit limit and charges you fees and interest when ready — often before you even leave the ATM.
The three costs are: a cash advance fee (usually 3 to 5 percent of the amount withdrawn), a higher interest rate than your regular purchase rate, and interest that starts accruing the same day you withdraw the cash, with no grace period. Because of these costs, a cash advance should be a last resort, not a convenient way to get spending money.
If you need cash, a debit card withdrawal, a bank transfer, or a personal loan will almost always cost you less.
Key Takeaways
- Cash advances charge a fee (typically 3 to 5 percent) plus a higher interest rate than purchases, with interest starting when ready.
- You can withdraw cash at an ATM using your credit card PIN, or ask a bank teller or cashier for a cash advance over the counter.
- Your credit card statement will show the cash advance separately from purchases, and the balance may have different terms.
- The interest rate on a cash advance is usually 5 to 10 percentage points higher than your purchase rate, and varies by card and issuer.
- Paying back a cash advance quickly is critical because interest compounds daily and no grace period applies.
Where and how to withdraw cash from your credit card
You can withdraw cash at any ATM that displays your card's logo (Visa, Mastercard, American Express, or Discover). Insert your card, enter your PIN, select "cash advance" or "withdrawal," and choose the amount. The ATM will dispense cash and charge you the fee when ready.
You can also walk into a bank branch or credit union and ask the teller for a cash advance. Bring your card and ID. The teller will process it the same way an ATM does, but you can ask questions about fees and your account balance before completing the transaction.
Some retailers allow cash advances at the checkout counter, though this is less common now. Ask the cashier if they offer this service before you attempt it.
The fees and interest rates you will pay
Every credit card issuer sets its own cash advance fee and interest rate. The fee is usually a flat percentage of the amount withdrawn — commonly 3 to 5 percent, with a minimum fee of $5 to $10. A $200 cash advance at 4 percent costs $8 in fees alone.
The interest rate on a cash advance is separate from your purchase rate. If your card charges 18 percent APR on purchases, the cash advance rate might be 23 or 25 percent. This rate is stated in your card's terms and conditions, which you can find on your issuer's website or by calling the number on the back of your card.
Interest begins accruing the day you withdraw the cash — there is no grace period like there is for purchases. If you withdraw $500 at 24 percent APR, you owe roughly $3.29 in interest the first day, and that amount compounds daily until you pay the balance back.
How a cash advance appears on your statement and credit report
Your credit card statement separates cash advances from regular purchases. You will see a line item labeled "cash advance" with the amount, the fee charged, and the interest accrued. The cash advance balance may have its own interest rate and may not be may be able to access for any promotional 0 percent offers on your card.
When you make a payment to your credit card, the payment is usually applied to the lowest-interest balance first — which means purchases before cash advances. This means your cash advance can sit and accrue interest while you pay down purchases, making it even more expensive.
A cash advance does not hurt your credit score directly, but it does increase your credit utilization (the percentage of your available credit you are using), which can lower your score slightly. Paying it back quickly will reverse this effect.
Why a cash advance is expensive compared to other options
A $300 cash advance at 4 percent fee plus 24 percent APR costs $12 in fees plus roughly $6 in interest over one month if you do not pay it back when ready. A personal loan for the same amount at 12 percent APR over one month would cost roughly $3 in interest — one-sixth the cost.
A debit card withdrawal costs nothing. A balance transfer to a 0 percent promotional card (if you may have access to) costs 3 to 5 percent but no ongoing interest. Even a payday loan, which is predatory, is sometimes cheaper than a cash advance if you repay it within two weeks.
The only scenario where a cash advance makes sense is an emergency where you have no other option and can repay it within days. Otherwise, the cost is not worth it.
How to repay a cash advance quickly
Pay the cash advance balance as soon as you can. Every day you carry it costs you money in interest. If you withdrew $300 at 24 percent APR, waiting 30 days to repay it costs you roughly $18 in interest on top of the original fee.
When you make a payment, contact your issuer to confirm that the payment is applied to the cash advance balance, not just to your overall account. Some issuers allow you to specify which balance a payment goes toward; others explore payments automatically to the lowest-interest balance first, which may not be the cash advance.
If you cannot repay the full amount when ready, pay as much as you can. Even a partial payment reduces the daily interest accrual and shows the issuer you are working to resolve it.
Alternatives to a cash advance
If you need cash and do not have a debit card or bank account, a credit union cash advance (if you are a member) often charges lower fees than a credit card. Some credit unions charge $5 flat or 1 percent, compared to 3 to 5 percent on a credit card.
A personal loan from a bank, credit union, or online lender typically charges 6 to 36 percent APR depending on your credit, with no daily interest accrual — you know the exact cost upfront. If you need $500 and can wait a few days for the money, a personal loan is usually cheaper than a cash advance.
A balance transfer to a 0 percent promotional card charges a one-time fee (3 to 5 percent) but no interest for 6 to 21 months, depending on the card. This only works if you may have access to for a new card and can transfer the balance before the promotional period ends.
If you are in a true emergency, ask family or friends for a loan, negotiate a payment plan with the person or business you owe money to, or contact a local nonprofit credit counselor (through the National Foundation for Credit Counseling) for low-cost information.
Frequently Asked Questions
Can I use a credit card to withdraw money at any ATM?
You can use any ATM that displays your card's logo. However, if the ATM is not owned by your card issuer, you may be charged an additional ATM fee (usually $2 to $3) on top of the cash advance fee. Using an ATM owned by your issuer or a partner network avoids this extra charge.
What is the difference between a cash advance and a balance transfer?
A cash advance gives you physical cash and charges a fee plus a high interest rate when ready. A balance transfer moves debt from one card to another and may offer 0 percent interest for a promotional period. A balance transfer is cheaper if you may have access to, but it does not give you cash.
Does a cash advance hurt my credit score?
A cash advance itself does not hurt your score, but it increases your credit utilization ratio, which can lower your score by a few points. Paying it back quickly will reverse this effect. Missed payments or defaulting on a cash advance will damage your score significantly.
Can I get a cash advance if my credit card is maxed out?
No. A cash advance counts against your available credit limit, just like a purchase does. If your card is maxed out, you cannot withdraw cash. You would need to pay down the balance first or request a credit limit increase from your issuer.
How long does it take for a cash advance to show up on my statement?
A cash advance appears on your statement within one to three business days, depending on your issuer. Interest starts accruing the day you withdraw the cash, even if it has not appeared on your statement yet.