Yes, you can take cash out with a credit card, but it costs more than a regular purchase
Most credit cards let you withdraw cash from an ATM or get cash back at a store checkout. The card issuer treats this 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 You also pay an upfront fee, typically 3 to 5 percent of the amount withdrawn.
The mechanics are straightforward: you use your card at an ATM or ask a cashier for cash back, and the money appears in your account within minutes. But the cost structure is deliberately different from a purchase, and that difference matters if you're thinking about using this as a regular money source.
Key Takeaways
- Cash advances charge interest from day one with no grace period, while purchases usually have 21 to 25 days interest-free.
- You pay an upfront fee of 3 to 5 percent of the cash amount, plus a higher interest rate than your purchase APR.
- The total cost of a $500 cash advance can easily reach $50 to $100 depending on how long you carry the balance.
- ATM withdrawals and store cash-back requests both count as cash advances and trigger the same fees and rates.
How the fees and interest work on a cash advance
When you take out a cash advance, you face three costs. First is the cash advance fee, charged upfront. This is usually a flat dollar amount (like $5 or $10) or a percentage of the amount withdrawn — whichever is higher. Most cards charge 3 to 5 percent, so a $500 withdrawal costs $15 to $25 just to get the cash.
Second is the cash advance APR, which is almost always higher than your purchase APR. Where your regular purchases might carry 18 percent APR, cash advances often run 25 to 30 percent or higher. Third, there is no grace period. Interest starts accruing the moment you withdraw the cash, even if you pay it back within days. A purchase gives you roughly 21 to 25 days before interest kicks in; a cash advance gives you zero.
The math adds up quickly. A $500 cash advance at 4 percent fee ($20) plus 28 percent APR costs you roughly $50 to $100 in fees and interest if you carry it for a month. If you carry it for three months, you're looking at $150 or more.
Where you can withdraw cash with a credit card
You have two main options. ATM withdrawals work at most machines that display your card's logo — Visa, Mastercard, American Express, or Discover. You insert your card, enter your PIN, and withdraw cash up to your daily limit. Some ATMs charge an additional operator fee ($2 to $3) on top of your card issuer's cash advance fee.
Store cash back is often free of the operator fee. You make a purchase and ask the cashier for cash back, which is deducted from your credit limit. This still counts as a cash advance and triggers the same fee and interest rate as an ATM withdrawal. The advantage is you avoid the ATM operator fee, though you have to make a purchase to use it.
Some card issuers set a daily cash advance limit separate from your overall credit limit — often $500 to $1,000 per day. Check your card's terms or call the issuer to find out what your limit is before you try to withdraw.
Why cash advances are more expensive than other ways to get money
Credit card companies charge more for cash advances because they see them as riskier than purchases. With a purchase, the merchant guarantees the transaction and handles disputes. With a cash advance, the issuer has no such protection — you have the cash, and if you don't pay it back, they have limited recourse. The higher fee and interest rate are their way of pricing that risk.
Compare this to other borrowing options. A personal loan from a bank or credit union typically charges 6 to 36 percent APR with no upfront fee. A payday loan charges a flat fee but is meant to be repaid in two weeks. A balance transfer to a 0 percent APR card (if you may have access to) costs a 3 to 5 percent transfer fee but no interest for 6 to 21 months. In most cases, one of these alternatives is cheaper than a cash advance if you need cash for more than a few days.
How a cash advance affects your credit score
Taking a cash advance itself does not directly lower your score, but it can indirectly. The withdrawal increases your credit utilization — the percentage of your available credit you're using. If you normally use 20 percent of your $5,000 limit and then take a $500 cash advance, you jump to 30 percent utilization. Credit scoring models penalize high utilization, so your score may drop a few points.
The bigger risk is if you carry the balance and miss a payment. Late payments stay on your credit report for seven years and cause much larger score damage than the utilization bump. If you do take a cash advance, prioritize paying it off quickly to avoid this trap.
When a cash advance might make sense
Cash advances are rarely the best choice, but there are narrow situations where they're the least bad option. If you need cash for an emergency and have no other way to get it — no savings, no family to borrow from, no time to wait for a personal loan — a small cash advance for a few days might cost less than the alternative (like a bounced check fee or a late utility payment).
If you're traveling internationally and your debit card doesn't work, a cash advance might be your only way to access money, even though it's expensive. In that case, withdraw the minimum you need and pay it back as soon as you return home.
Outside these narrow cases, it's worth exploring other options first. If you're regularly using cash advances to cover expenses, that's a sign your budget needs attention or you need a different form of credit.
Frequently Asked Questions
Does a cash advance show up differently on my credit report?
No, it appears as a credit card transaction like any other. However, if you carry the balance and miss a payment, the late payment itself is reported — not the fact that it was a cash advance. The damage comes from the missed payment, not the type of transaction.
Can I use a cash advance to pay off another credit card?
Technically yes, but it's expensive. You'd pay the cash advance fee and high interest rate on top of whatever you already owe on the other card. A balance transfer (moving the balance to a 0 percent card) is almost always cheaper if you may have access to.
What's my daily cash advance limit?
It varies by card and issuer. Some cards set it at $500 per day, others at $1,000 or higher. Check your card's terms document or call the issuer's customer service number on the back of your card to find out your specific limit.
If I pay back a cash advance when ready, do I still pay interest?
You still pay the upfront fee, but you can minimize interest. Interest accrues daily, so if you withdraw $500 on Monday and pay it back on Tuesday, you'll owe roughly one day's worth of interest (a few dollars). The fee is unavoidable, but speed matters for the interest portion.
Can I get a cash advance with a prepaid card or secured credit card?
Most prepaid cards do not allow cash advances. Secured credit cards (backed by a deposit) usually do allow them, but the terms vary. Check your card's terms or contact the issuer before assuming you can withdraw cash.