Yes, you can use a credit card at an ATM, but it costs you money and works differently than a debit card
Most credit cards let you withdraw cash at an ATM, but the transaction is called a cash advance, not a regular purchase. The moment you take the money out, you start paying interest — usually at a higher rate than your regular purchase APR. You also pay an upfront fee, either a flat dollar amount or a percentage of what you withdraw. The cash advance hits your credit limit when ready, which can lower your available credit and affect your credit score.
The key difference: when you swipe your card for a purchase, you get a grace period (usually 21 to 25 days) before interest starts. With a cash advance, interest starts accruing the same day you withdraw the money. There is no grace period.
Key Takeaways
- Cash advances charge interest from day one with no grace period, while regular purchases get 21 to 25 days interest-free.
- You pay both an upfront fee (typically 3 to 5 percent of the amount withdrawn) and a higher APR than your purchase rate.
- The cash advance counts against your credit limit and may lower your available credit when ready.
- Using a credit card for cash advances regularly signals financial stress to lenders and can damage your credit score over time.
How the fees and interest work
When you insert your credit card into an ATM and choose the cash advance option, two costs hit you right away. First is the cash advance fee, charged by your card issuer. This is usually between 3 and 5 percent of the amount you withdraw, with a minimum fee of $2 to $10. So if you withdraw $200, you might pay $6 to $10 just to get the cash.
Second is the ATM operator fee, charged by the bank or network that owns the machine. This is typically $2 to $3 per transaction and goes to them, not your card issuer. You pay both fees whether the ATM is in your bank's network or not.
Then comes the interest. Your card issuer charges a cash advance APR, which is almost always higher than your purchase APR. If your purchase rate is 18 percent, your cash advance rate might be 24 or 27 percent. Interest accrues daily from the moment you withdraw the cash, and it compounds. If you carry the balance for a month, the interest alone can add $30 to $50 to a $200 withdrawal.
What happens to your credit limit and score
A cash advance uses your available credit just like a purchase does. If your credit limit is $2,000 and you withdraw $200 in cash, your available credit drops to $1,800 when ready. This matters because credit card companies look at your credit utilization ratio — the percentage of your total credit limit you are using across all cards. The higher your utilization, the more it can hurt your credit score.
If you regularly use cash advances, lenders see it as a sign that you are short on cash and managing money poorly. This pattern can lower your score over time and make it harder to get approved for loans, mortgages, or new credit cards in the future. Even one cash advance can cause a small dip if your utilization jumps significantly.
When a cash advance might make sense
There are rare situations where a credit card cash advance is the least bad option. If you have a genuine emergency — a car repair you need today, a medical bill due when ready — and you have no other way to pay, a cash advance is faster than a personal loan. You get the money in minutes instead of days.
But this should be a last resort, not a habit. If you find yourself regularly needing cash advances, that is a sign your budget has a bigger problem. You are spending more than you earn, and borrowing at 24 to 27 percent interest will only make that worse.
Better alternatives to a credit card cash advance
If you need cash urgently, explore these options first. A personal loan from a bank or credit union usually has a lower APR than a cash advance and gives you a fixed repayment schedule. Even with bad credit, a credit union personal loan often costs less than a cash advance. The trade-off is that approval takes a few days instead of minutes.
A payday loan is faster but often more expensive than a cash advance, so it is not really better — just different. A balance transfer from another credit card might work if you have one with a 0 percent introductory rate, though you still pay a transfer fee. Asking family or friends for a short-term loan costs nothing if they agree. If you have a 401(k), some plans let you borrow against your own money at a low rate, though this has tax consequences if you leave your job.
If the emergency is housing-related, food-related, or medical, look for local nonprofits or government programs that offer emergency grants or interest-free loans. These exist in most areas and do not show up on your credit report.
How to avoid needing a cash advance
The real solution is building an emergency fund so you never have to choose between a cash advance and nothing. Start small — even $500 in a savings account separate from your checking account can cover most small emergencies. Keep it in a place you can reach in a day or two but not so straightforward that you dip into it for non-emergencies.
If you are living paycheck to paycheck and cannot save, the problem is not that you need a cash advance — it is that your income is too low or your expenses are too high. A cash advance will make this worse, not better. Consider talking to a credit counselor (many nonprofits offer this free) about budgeting and finding ways to increase income or cut expenses.
What to do if you have already taken a cash advance
If you have already withdrawn cash on your credit card, pay it back as fast as you can. The interest compounds daily, so every day you carry the balance costs you more. Do not make the minimum payment — that will keep you in debt for months.
If you took multiple cash advances or are carrying a large balance, contact your card issuer and ask if they offer a balance transfer option to a lower-rate card, or ask about a hardship program if you are struggling to pay. Some issuers will work with you if you call before you miss a payment. Do not wait until you are behind.
Frequently Asked Questions
Can I use any credit card at any ATM?
Most credit cards work at most ATMs, but you will pay a fee either way. Your card issuer charges a cash advance fee, and the ATM operator charges a separate fee. Some cards have partnerships with certain ATM networks that waive the operator fee, so check your card's terms to see if yours does.
Is a cash advance the same as a purchase?
No. A purchase gets a grace period before interest starts, usually 21 to 25 days. A cash advance charges interest from day one. The APR is also higher for cash advances. Both count against your credit limit, but cash advances are much more expensive.
Will a cash advance hurt my credit score?
It can, especially if it raises your credit utilization significantly or if you carry the balance for a long time. A single small cash advance might have little effect, but regular cash advances signal financial stress and can lower your score over time.
What if my credit card company won't let me take a cash advance?
Some issuers block cash advances for accounts with recent missed payments or very high utilization. If this happens, it is a sign your card issuer thinks you are at risk of not paying back borrowed money. Focus on paying down your balance and making on-time payments before trying again.
Can I get a cash advance without paying a fee?
No. You will always pay at least the cash advance fee from your issuer (typically 3 to 5 percent) plus the ATM operator fee (typically $2 to $3). Some cards offer no cash advance fee as a cardholder benefit, but these are rare and usually only for premium cards with annual fees.