Yes, you can take cash off your credit card, but it costs more than a purchase and starts charging interest when ready
Taking cash off a credit card is called a cash advance. Your card issuer lets you withdraw money from an ATM or get cash from a bank teller using your credit card, just as you would with a debit card. The money goes into your bank account or your pocket, and you repay it like any other credit card balance.
The catch is significant: cash advances charge a separate fee (usually 3 to 5 percent of the amount withdrawn), carry a higher interest rate than regular purchases (often 2 to 3 percentage points above your purchase APR), and begin accruing interest the moment you withdraw the money — there is no grace period like there is for purchases. A $500 cash advance at a 5 percent fee costs $25 upfront, then starts charging daily interest at a rate that might be 25 percent or higher.
Most people use cash advances only when they have no other option, because the cost adds up fast. If you need cash, a personal loan, a line of credit, or even a payday loan from a credit union is usually cheaper.
Key Takeaways
- Cash advances charge an upfront fee (typically 3 to 5 percent) plus a higher interest rate than purchases, with no grace period before interest starts.
- You can withdraw cash at an ATM using your credit card's PIN, or visit a bank or credit union teller and ask for a cash advance.
- The interest rate on a cash advance is set by your card issuer and appears on your statement as a separate line item from purchase interest.
- Your credit card company may set a limit on how much you can withdraw as a cash advance, which is often lower than your overall credit limit.
- Paying off a cash advance should be your priority, because the interest compounds daily and the balance does not benefit from any promotional rates.
How to withdraw cash using your credit card
The simplest method is to use an ATM. Insert your credit card into any ATM that displays your card's logo (Visa, Mastercard, American Express, or Discover), enter your PIN, select "cash advance" or "withdraw cash," and choose your amount. The ATM will dispense the cash and charge it to your credit card account.
If you do not know your PIN, call the number on the back of your card and ask the issuer to send you one or set one up over the phone. Some issuers let you set a PIN online through your account dashboard.
You can also visit a bank or credit union branch in person. Bring your credit card and a photo ID, tell the teller you want a cash advance, and they will process it at the counter. This method works even if you do not have a PIN set up yet.
A third option is to use a convenience check, if your card issuer sends them. These checks draw against your credit card account and function as a cash advance. You write the check to yourself, deposit it in your bank account, and the amount appears on your credit card bill.
Fees and interest rates for cash advances
Every credit card issuer sets its own cash advance fee and interest rate. The fee is a flat percentage of the amount withdrawn — typically 3, 4, or 5 percent — with a minimum dollar amount (often $5 or $10). A $200 cash advance with a 5 percent fee and $10 minimum costs $10. A $500 advance costs $25.
The interest rate is separate from your purchase APR and is usually higher. If your card charges 18 percent APR on purchases, the cash advance rate might be 22 or 25 percent. This rate is listed in your card's terms and conditions, which you can find on your issuer's website or by calling customer service.
Interest on a cash advance accrues daily from the moment you withdraw it. There is no grace period. If you withdraw $500 at 25 percent APR, you owe approximately $3.42 in interest after one day, $6.85 after two days, and so on. The longer you carry the balance, the more interest compounds.
Some card issuers cap the cash advance fee at a maximum dollar amount (for example, $50 or $75), so very large withdrawals do not incur unlimited fees. Check your card's terms to see if this applies to you.
Cash advance limits and how they work
Your credit card issuer sets a separate cash advance limit, which is the maximum amount you can withdraw. This limit is often 20 to 50 percent of your overall credit limit, though it varies by issuer and your creditworthiness. If your credit limit is $5,000, your cash advance limit might be $1,000 or $2,500.
You can find your cash advance limit by logging into your online account, calling the number on the back of your card, or checking your most recent statement. If you try to withdraw more than your limit, the ATM or teller will decline the transaction.
Withdrawing a cash advance counts against your overall credit limit. If you have a $5,000 limit and withdraw $1,000 as a cash advance, you have $4,000 remaining credit available for purchases and other transactions.
How a cash advance affects your credit score
A cash advance itself does not appear as a separate item on your credit report. However, it increases your credit utilization — the percentage of your available credit that you are using. If you have a $5,000 limit and carry a $1,000 cash advance balance, your utilization jumps to 20 percent. High utilization can lower your credit score, especially if you are already carrying other balances.
The cash advance balance also accrues interest faster than a purchase balance, so it can grow quickly if you only make minimum payments. This keeps your utilization high for longer, which continues to weigh on your score.
Making a large payment toward the cash advance balance as soon as possible is the best way to minimize the credit score impact. Paying it off entirely stops the interest from compounding and lowers your utilization when ready.
Alternatives that cost less than a cash advance
Before you use a cash advance, consider these cheaper options. A personal loan from a bank, credit union, or online lender typically charges 6 to 36 percent APR with no upfront fee, and interest does not start until you receive the funds. A $500 personal loan at 15 percent APR costs roughly $37 in interest over one year — less than the upfront fee on a cash advance, and the rate is fixed.
A line of credit from your bank or credit union works similarly to a personal loan but lets you draw money as you need it, paying interest only on what you use. Many credit unions offer lines of credit at rates between 8 and 18 percent.
If you need cash urgently and have poor credit, a credit union payday loan is often cheaper than a cash advance. Credit unions are required by federal law to cap payday loan rates at 28 percent APR, and many charge less. A traditional payday lender charges 400 percent APR or higher, so avoid those.
If you have a friend or family member who can lend you money, that is the cheapest option of all — assuming you can repay it on a schedule you both agree to.
What happens if you cannot pay back a cash advance
If you carry a cash advance balance and only make minimum payments, the interest compounds and the balance grows. A $500 cash advance at 25 percent APR with $25 minimum payments takes roughly 24 months to pay off and costs about $100 in interest alone.
If you miss a payment on a cash advance, your card issuer reports the missed payment to the credit bureaus after 30 days, which damages your credit score. After 60 days, the issuer may charge a late fee (typically $25 to $40). After 180 days of non-payment, the issuer may close your account and send the debt to a collection agency.
If you are struggling to repay a cash advance, contact your card issuer when ready. Some issuers offer hardship programs that lower your interest rate or allow you to pause payments temporarily. This is not a formal program you can "explore" for — you call and ask whether your issuer offers one, and they decide based on your situation.
Frequently Asked Questions
Can I use a cash advance to pay off 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 interest and fees instead of one. A balance transfer (moving the debt from one card to another) is cheaper if you may have access to, because many cards offer 0 percent APR on transfers for 6 to 21 months.
Does a cash advance show up differently on my credit report than a regular purchase?
No. Your credit report shows only your total credit card balance and payment history, not whether that balance came from purchases or cash advances. However, the cash advance balance appears separately on your credit card statement, and the interest rate is listed separately as well.
What is the difference between a cash advance and a balance transfer?
A cash advance withdraws money from your credit card account and puts it in your pocket or bank account. A balance transfer moves debt from one credit card to another card. Balance transfers usually charge a lower fee (2 to 3 percent versus 3 to 5 percent) and often come with a promotional 0 percent APR period. Use a balance transfer to move existing debt; use a cash advance only if you need actual cash.
Can I get a cash advance from a credit card I do not use?
Yes. As long as your card is active and you have not exceeded your cash advance limit, you can withdraw cash from any credit card account you own. However, the fee and interest rate explore regardless of how often you use the card.
Will my bank charge me a fee on top of the credit card fee?
Possibly. If you use an ATM that does not belong to your bank, the ATM operator may charge a surcharge (typically $2 to $3) in addition to the cash advance fee your credit card issuer charges. Using an ATM from your own bank or a bank in your card issuer's network avoids this extra cost. Visiting a bank teller in person usually does not incur an ATM surcharge.