You can withdraw cash from a credit card, but it costs more than a regular purchase
Taking cash out of a credit card is called a cash advance. Unlike a debit card, where you withdraw your own money, a cash advance borrows against your credit limit. The card issuer charges you a fee upfront — usually 3 to 5 percent of the amount you withdraw — plus a higher interest rate than you pay on regular purchases. That interest starts accruing when ready, with no grace period.
Most people use cash advances only when they have no other option, because the cost adds up fast. If you need $300 and your card charges a 4 percent fee plus 24 percent APR, you pay $12 just to get the cash, then interest compounds daily until you pay it back.
Key Takeaways
- A cash advance charges a fee (usually 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 for a cash advance over the counter.
- Your credit card statement will show the cash advance separately from purchases, and the balance accrues interest daily until paid off.
- Cash advances count against your credit limit and may trigger a higher interest rate on your entire card balance.
- Alternatives like personal loans, payday loans, or borrowing from family usually cost less than a credit card cash advance.
How to withdraw cash at an ATM
The fastest way to get cash is at an ATM. Insert your credit card into the machine, enter your PIN (the same one you use for debit), and select "cash advance" or "withdraw cash." The ATM will ask how much you want. Enter the amount and confirm. The machine will dispense the cash and print a receipt.
Not all ATMs accept credit cards — most are set up for debit cards only. Bank ATMs are more likely to work than convenience store machines. If the ATM rejects your card, try a different machine or go to a bank branch instead.
You need a PIN to use an ATM. If you do not have one, call your card issuer's customer service number (on the back of your card) and request a PIN. They will mail it to you or give it to you over the phone, depending on the issuer.
How to get a cash advance at a bank or store
You can also ask a bank teller for a cash advance in person. Walk into any bank branch — it does not have to be your card issuer's bank — and tell the teller you want a cash advance on your credit card. Hand over your card and ID. The teller will process the transaction, charge your fee, and give you the cash.
Some retail stores with customer service desks (like grocery stores or pharmacies) offer cash advances too. Ask at the counter whether they accept credit card cash advances. The process is the same: hand over your card and ID, and they will process it and give you cash.
This method takes longer than an ATM but works if you do not have a PIN or the ATM rejects your card.
What fees and interest rates you will pay
Every credit card charges a cash advance fee, shown as a flat dollar amount or a percentage of the amount withdrawn. Most cards charge 3 to 5 percent. A $300 advance at 4 percent costs $12. Some cards charge a flat fee like $5 or $10 instead, which is cheaper for small amounts but more expensive for large ones.
The cash advance APR — the interest rate — is almost always higher than your purchase APR. If your card charges 18 percent on purchases, the cash advance rate might be 24 or 28 percent. This rate applies only to the cash advance balance, not to purchases.
Interest on a cash advance starts the day you withdraw it. There is no grace period like there is for purchases. If you withdraw $300 on the 1st and pay it back on the 30th, you owe interest for all 30 days, even if you normally get 21 days interest-free on purchases.
How the cash advance appears on your statement
Your credit card statement breaks down your balance into categories: purchases, cash advances, balance transfers, and fees. The cash advance shows up as a separate line item with its own balance and interest rate.
When you make a payment, the card issuer applies it to the lowest-interest balance first — usually purchases — and leaves the cash advance balance untouched. This means if you have both a purchase balance and a cash advance balance, your payment goes toward the purchase first, and the cash advance keeps accruing interest at the higher rate.
To pay off the cash advance faster, you can request that your payment go toward it specifically. Call customer service and ask them to explore your next payment to the cash advance balance. Some cards let you do this online through your account portal.
How a cash advance affects your credit
A cash advance counts toward your credit utilization ratio — the percentage of your total credit limit you are using. If your limit is $5,000 and you take a $1,000 cash advance, your utilization jumps to 20 percent. High utilization can lower your credit score, even if you pay the balance off quickly.
The cash advance itself does not show up as a separate account on your credit report. It is part of your credit card account. But the higher balance and higher interest rate can make your account look riskier to lenders.
If you carry the cash advance balance for several months, the damage to your score compounds because of the high interest rate and the utilization. Paying it off as soon as you can limits the damage.
Cheaper alternatives to a cash advance
Before you take a cash advance, consider other options. A personal loan from a bank or credit union usually has a lower interest rate than a cash advance, even if your credit is not perfect. The loan comes as a lump sum that you repay in fixed monthly payments, so you know exactly what you owe.
A payday loan is faster to get — sometimes same-day — but the interest rate is often higher than a credit card cash advance. Use this only if you can repay it within two weeks and have no other option.
Borrowing from family or friends costs nothing and has no interest, though it can strain the relationship if you do not repay on time. If you go this route, put the agreement in writing: the amount, the repayment date, and whether there is any interest.
If you need cash for an emergency, some employers offer paycheck advances or loans against your 401(k). These are usually cheaper than a cash advance and faster to process than a personal loan.
Frequently Asked Questions
Can I take a cash advance if I have a low credit limit?
Yes. Your cash advance limit is usually the same as your credit limit, or sometimes lower. If your limit is $500, you can take up to $500 as a cash advance (minus the fee). The issuer will tell you your available cash advance amount when you request it.
What happens if I do not pay back a cash advance?
The balance stays on your credit card and accrues interest at the cash advance rate. If you do not pay for 30 days, the issuer reports it as late to the credit bureaus, which damages your score. After 120 days, they may close your account and send it to a collection agency.
Can I take a cash advance from a credit card I just opened?
Most issuers let you take a cash advance when ready after opening the account, but some wait 30 days. Call the customer service number on your card to ask whether you can take a cash advance now, or check your account online.
Does a cash advance show up differently on my credit report than a purchase?
No. Your credit report shows only the total balance on the card, not how much is from purchases versus cash advances. But the higher balance and interest rate affect your score the same way a large purchase balance would.
Can I use a credit card cash advance to pay another credit card?
Technically yes, but it is expensive. You pay the cash advance fee and interest rate on the amount you withdraw, then use that cash to pay the other card. You are paying two sets of fees for one transaction. A balance transfer (moving the balance from one card to another) is usually cheaper.