Yes, you can transfer money from a credit card, but it costs you and works differently than a debit card
A credit card cash advance or balance transfer lets you move money from your credit card into a bank account or to another card. The catch: both charge fees upfront, and cash advances charge interest when ready — there is no grace period like there is for purchases. A balance transfer moves debt from one card to another, usually at a lower rate for a set period, but also charges a fee.
The method you use depends on what you need the money for. If you need cash in your bank account, a cash advance is the only direct route. If you are moving existing debt to a card with a better rate, a balance transfer makes sense. If you are trying to pay down debt cheaply, neither is the answer — both cost more than paying from your own money or borrowing from a bank.
Key Takeaways
- A cash advance pulls money directly from your credit card into your bank account, but charges a fee (usually 3 to 5 percent) plus interest starting when ready.
- A balance transfer moves debt from one credit card to another, typically with a lower interest rate for 6 to 21 months, but also charges an upfront fee.
- Both methods add to your credit card balance and count toward your credit limit, so they can lower your credit score if they push your balance too high.
- Cash advances and balance transfers are not the same as a regular purchase — they do not get a grace period and start charging interest right away.
How a cash advance works and what it costs
A cash advance is the most direct way to get money from your credit card into your bank account. You go to an ATM with your credit card, withdraw cash, and deposit it. Or you can call your card issuer and ask them to send money to your bank account directly — some issuers offer this option, though it is less common.
The cost is when ready and steep. Most card issuers charge a cash advance fee of 3 to 5 percent of the amount you withdraw, with a minimum of $5 to $10. If you withdraw $500, you might pay $15 to $25 just to get the cash. On top of that, interest starts accruing the day you withdraw — there is no grace period. The interest rate for cash advances is usually higher than the rate for purchases, often 2 to 3 percentage points above your regular APR.
Example: You withdraw $500 from your credit card at an ATM. Your card charges a 4 percent cash advance fee ($20) and a 24 percent APR on cash advances. After one month, you owe $520 in principal plus roughly $10 in interest — $530 total. If you pay it off over three months, interest alone could add $25 to $30 to what you owe.
How a balance transfer works and when it makes sense
A balance transfer moves debt from one credit card to another, usually one offering a lower interest rate for a promotional period. You do not get cash — the new card issuer pays off the old card balance directly. This is useful if you have high-interest debt on one card and find a card with a 0 percent introductory rate.
Balance transfers also charge a fee, typically 3 to 5 percent of the amount transferred, charged upfront and added to your new balance. If you transfer $2,000 at a 3 percent fee, you owe $2,060 on the new card when ready. The advantage is that during the promotional period — which might last 6, 12, or 21 months depending on the card — you pay no interest on that transferred balance, only the fee.
A balance transfer only makes sense if the savings from the lower rate outweigh the transfer fee and if you have a plan to pay down the balance before the promotional rate ends. If you transfer $2,000 at a 3 percent fee ($60) to a 0 percent card for 12 months, you save roughly $240 in interest compared to paying 12 percent on the original card — a net gain of $180. But if you do not pay it off by month 13, the rate jumps to the card's regular APR, often 18 to 25 percent, and you lose the advantage.
Why both methods hurt your credit score
Cash advances and balance transfers both increase your credit card balance, which affects your credit utilization ratio — the percentage of your available credit you are using. If you have a $5,000 limit and a $2,000 balance, your utilization is 40 percent. A $1,000 cash advance pushes it to 60 percent. Credit scoring models penalize high utilization, so your score can drop by 10 to 50 points depending on how much you borrow and how close you are to your limit.
The damage is temporary if you pay the balance down quickly. Once you drop below 30 percent utilization, your score begins to recover. But if you carry the balance for months, the score impact lingers as long as the utilization stays high.
Alternatives that cost less
Before using a cash advance or balance transfer, consider cheaper options. A personal loan from a bank or credit union typically charges 6 to 15 percent interest with no upfront fee — much cheaper than a cash advance at 24 to 30 percent. A 0 percent balance transfer card makes sense only if you are certain you can pay off the balance before the rate jumps.
If you need cash for an emergency, a personal loan or a line of credit from your bank costs less than a cash advance. If you are trying to pay down existing debt, a debt consolidation loan rolls multiple balances into one payment at a single rate, often lower than your current cards. If you are short on cash temporarily, asking your creditors for a payment plan or deferment costs nothing and does not add new debt.
How to do a cash advance or balance transfer
For a cash advance at an ATM, insert your credit card, enter your PIN (which you may need to set up first by calling your issuer), and withdraw the amount you need. The fee and interest post to your account within one to three business days.
For a cash advance by bank transfer, call your card issuer's customer service number on the back of your card. Ask if they offer direct bank transfers. If they do, provide your bank account number and routing number, and request the transfer. The money typically arrives in one to three business days. Ask about the fee and interest rate before you confirm.
For a balance transfer, explore for a new credit card offering a 0 percent promotional rate. Once approved, log into your account and look for a "balance transfer" or "move a balance" option. Enter the old card details and the amount to transfer. The new issuer contacts the old issuer and pays off the balance directly. The transfer usually completes within 7 to 21 days. The fee appears on your first statement.
What happens if you cannot pay it back
If you take a cash advance or transfer a balance and cannot pay it back, the debt works like any other credit card debt. Interest keeps accruing, your balance grows, and missed payments damage your credit score. After 30 days late, the issuer reports it to the credit bureaus. After 180 days, they may charge off the account and sell the debt to a collection agency.
The only difference is that cash advances and balance transfers start with higher interest rates and fees already built in, so the debt grows faster. If you are struggling to pay, contact your card issuer when ready and ask about hardship programs, payment plans, or rate reductions. Many issuers have options before your account goes to collections.
Frequently Asked Questions
Can I transfer money from a credit card to my bank account without paying a fee?
No. Any method that moves money from a credit card to your bank account — whether a cash advance, bank transfer, or ATM withdrawal — charges a fee of 3 to 5 percent. Some cards offer 0 percent balance transfer promotions, but that applies only to transfers between credit cards, not to cash in your bank account.
Is a balance transfer the same as a cash advance?
No. A balance transfer moves debt from one credit card to another and does not give you cash. A cash advance gives you cash but charges higher fees and interest. Balance transfers are useful for consolidating high-interest debt; cash advances are for getting cash when you need it, though they are expensive.
How long does a balance transfer take?
Most balance transfers complete within 7 to 21 days after you request them. The new card issuer contacts your old issuer, and the payment is processed. You should see the old balance drop and the new balance appear on your new card's statement within that window.
Will a cash advance or balance transfer hurt my credit score?
Yes, both can lower your score temporarily because they increase your credit utilization ratio. The impact is usually 10 to 50 points depending on how much you borrow. Your score recovers as you pay down the balance and your utilization drops below 30 percent.
What if I need cash but do not want to use a cash advance?
A personal loan from a bank or credit union is usually cheaper — 6 to 15 percent interest with no upfront fee, compared to 3 to 5 percent fee plus 24 to 30 percent interest on a cash advance. A line of credit or overdraft protection from your bank may also be available at lower cost.