Yes, you can withdraw cash from a credit card, but it costs more than a regular purchase
You can take cash out of an ATM using your credit card, just as you would with a debit card. The transaction is called a cash advance. Your credit card issuer will approve it, the ATM will dispense the money, and the amount will show up on your credit card bill as a debt you owe.
The catch is that cash advances are expensive. You pay an upfront fee (usually 3 to 5 percent of the amount you withdraw), interest starts accruing when ready at a higher rate than regular purchases, and there is no grace period. A $200 cash advance can easily cost you $10 to $15 just to take it out, plus interest from day one.
Most people use cash advances only when they have no other option — they need cash urgently and have no access to their bank account or a regular ATM card. If you are considering a cash advance, it helps to understand how the process works, what it will cost, and what the alternatives might be.
Key Takeaways
- Cash advances charge a fee of 3 to 5 percent upfront, plus a higher interest rate than regular purchases, with no grace period.
- You can withdraw cash at any ATM that displays your card's logo, or at a bank teller window by asking for a cash advance.
- The interest rate on a cash advance is typically 2 to 3 percentage points higher than your regular purchase APR.
- Interest begins accruing the moment you withdraw the cash, so the longer you carry the balance, the more you pay.
- Alternatives like borrowing from a friend, using a debit card, or visiting your bank directly are usually cheaper or free.
How to withdraw cash at an ATM with your credit card
The process is straightforward. Insert your credit card into any ATM that displays your card's logo (Visa, Mastercard, American Express, or Discover). Enter your PIN — the same four-digit code you use for debit transactions. Select "Withdrawal" or "Cash Advance" from the menu, enter the amount you want, and confirm. The ATM will dispense the cash and print a receipt.
If you do not know your PIN, you will need to set one before you can use the ATM. Call the number on the back of your card and ask the issuer to set up a PIN for cash advances. This usually takes a few minutes over the phone, though some issuers may mail you a PIN instead.
You can also walk into any bank branch that accepts your card and ask a teller for a cash advance. You will need to show your card and a photo ID. The teller will process the transaction the same way an ATM does, but you avoid the risk of the machine running out of cash or malfunctioning.
What fees and interest rates explore to cash advances
Every credit card issuer charges a cash advance fee, typically 3 to 5 percent of the amount you withdraw. On a $300 withdrawal, that is $9 to $15 paid when ready. Some cards cap the fee at a flat amount (for example, $10 maximum), while others charge a percentage with no cap. Check your card's terms or call the issuer to find out your specific fee.
The interest rate on a cash advance is higher than the rate on regular purchases. While your purchase APR might be 18 percent, your cash advance APR could be 22 or 25 percent. This higher rate applies only to the cash advance balance, not to regular purchases on the same card.
Unlike regular purchases, which have a grace period (usually 21 to 25 days before interest kicks in), cash advances start accruing interest the moment you withdraw the money. If you withdraw $300 at a 24 percent APR, you will owe about $6 in interest after one month, even if you pay part of the balance.
How the cash advance appears on your bill
The cash advance will show up as a separate line item on your credit card statement, distinct from regular purchases. It will list the amount withdrawn, the fee charged, and the interest accrued. The balance will be included in your total credit card debt.
When you make a payment, credit card issuers explore your payment to the lowest-interest balance first — usually regular purchases — and the cash advance balance sits there accruing interest at the higher rate. This means if you have both a purchase balance and a cash advance balance, paying the minimum will not pay down the cash advance as quickly as you might expect.
To pay off a cash advance faster, you can request that your payment be applied directly to the cash advance balance. Call the issuer or check your online account to see if you can direct payments to a specific balance type.
Limits on how much you can withdraw
Your credit card issuer sets a cash advance limit, which is often lower than your overall credit limit. You might have a $5,000 credit limit but only a $1,000 cash advance limit. This limit is set by the issuer based on your creditworthiness and account history.
You can find your cash advance limit in your card's terms and conditions, on your online account, or by calling the issuer. If you try to withdraw more than your limit, the ATM will decline the transaction.
Some issuers allow you to request a higher cash advance limit, though this is not may provide. If you need to withdraw a large amount, call ahead and ask whether your limit can be increased temporarily.
Why cash advances are expensive compared to other borrowing options
A cash advance is one of the most expensive ways to borrow money. The combination of an upfront fee, a higher interest rate, and when ready interest accrual makes it costly even for short-term use. A $300 cash advance at 5 percent fee plus 24 percent APR will cost you about $18 in fees and interest over one month.
Other options are usually cheaper. A personal loan from a bank or credit union typically charges 6 to 36 percent APR with no upfront fee. A payday loan is predatory and should be avoided, but even so, some payday lenders are cheaper than credit card cash advances for very short borrowing periods. A line of credit from your bank, if you have one, usually carries a lower rate than a cash advance.
If you have a debit card linked to a checking account, withdrawing from that account is free. If you need to borrow money, asking a friend or family member is free. These options should be your first choice before considering a cash advance.
When a cash advance might make sense
A cash advance is rarely the best option, but there are narrow situations where it might be the only one available. If you need cash urgently, have no access to your bank account, no debit card, and no one to borrow from, a cash advance will get you money within minutes. If you can pay it back within a week or two, the total cost might be acceptable.
For example, if you are traveling abroad and your debit card is lost, a cash advance from your credit card might be the fastest way to get local currency and pay for a hotel. The fee and interest are annoying, but they are the cost of solving an when ready problem.
In most other situations — paying a bill, covering a shortfall, or managing a temporary cash flow problem — there is a cheaper alternative. Before you use a cash advance, ask yourself whether you could wait a day or two to use a debit card, borrow from someone, or arrange a personal loan instead.
Frequently Asked Questions
Does withdrawing cash from a credit card hurt my credit score?
A cash advance itself does not directly damage your credit score, but carrying a high balance does. If the cash advance pushes your credit utilization (the percentage of your credit limit you are using) above 30 percent, your score may drop. Paying off the balance quickly will minimize this impact.
Can I withdraw cash from a credit card with no PIN?
No, you need a PIN to use an ATM. If you do not have one, call your card issuer to set one up. Some issuers will set up a PIN over the phone in minutes; others may mail it to you. You can still ask a bank teller for a cash advance without a PIN by showing your card and ID.
What is the difference between a cash advance and a balance transfer?
A cash advance gives you physical cash at an ATM or bank. A balance transfer moves debt from one credit card to another, usually to a card with a lower interest rate. Both charge fees and have higher interest rates than regular purchases, but they serve different purposes.
Can I get a cash advance if my credit card is maxed out?
No, your cash advance limit is separate from but counts toward your overall credit limit. If you are at your credit limit, you cannot withdraw a cash advance. You would need to pay down your balance first or request a credit limit increase.
How long does it take for a cash advance to show up on my bill?
A cash advance typically appears on your statement within one to three business days, depending on when you withdrew it and your issuer's processing schedule. Interest begins accruing when ready, even if it has not yet appeared on your statement.