Yes, you can get cash with a credit card, but it costs more than a regular purchase
You can withdraw cash from your credit card at an ATM or ask a bank teller for cash back. The transaction is called a cash advance. Unlike a debit card withdrawal, a cash advance charges you interest when ready — there is no grace period — and usually costs an upfront fee as well. The interest rate on cash advances is almost always higher than the rate on regular purchases, sometimes by several percentage points. You start paying interest the day you take the cash out.
Most people use cash advances only when they have no other option, because the cost adds up quickly. If you need cash regularly, a debit card or ATM card tied to a checking account is cheaper. If you are considering a cash advance because you are short on money, look first at whether the purchase itself can wait, or whether you can borrow from someone else without interest.
Key Takeaways
- A cash advance charges an upfront fee (usually 3 to 5 percent of the amount) plus interest that starts accruing when ready, with no grace period.
- The interest rate on cash advances is typically 2 to 5 percentage points higher than the rate on regular credit card purchases.
- You can get a cash advance at an ATM using your credit card and PIN, or by visiting a bank branch and asking a teller.
- The cash advance amount counts toward your credit limit and appears on your statement as a separate transaction type.
- If you carry a balance on your card, payments go toward the lowest-interest debt first, so the cash advance may take longer to pay off.
How to get cash from an ATM with your credit card
Insert your credit card into an ATM just as you would a debit card. Enter your PIN — the same four-digit code you use for debit transactions. Select "cash advance" or "withdraw cash" from the menu. The ATM will show you the fee amount before you confirm. Enter the amount you want to withdraw, and the ATM will dispense the cash and print a receipt.
Not all ATMs accept credit cards. Bank-owned ATMs in the card issuer's network usually do, but independent ATMs and ATMs owned by other banks may decline your card. If an ATM rejects your credit card, try a different machine or visit a bank branch instead.
If you do not have a PIN for your credit card, you will need to set one up before you can use an ATM. Call the customer service number on the back of your card and ask how to create or reset your PIN. This usually takes a few minutes over the phone.
Getting cash at a bank teller window
Walk into any bank branch — it does not have to be your card issuer's bank — and ask the teller for a cash advance on your credit card. Bring your card and a photo ID. The teller will run your card, confirm the amount you want, and give you the cash. This method works even if you do not have a PIN set up.
Bank tellers can usually process a cash advance faster than an ATM, and you can ask questions about the fee before you confirm. Some people prefer this route because they can see the fee amount clearly before the transaction completes.
What the fees and interest actually cost
The upfront fee for a cash advance is typically 3 to 5 percent of the amount you withdraw. If you take out $500, expect to pay $15 to $25 just to get the cash. That fee is added to your credit card balance when ready.
The interest rate on cash advances is separate from your regular purchase rate. If your card charges 18 percent APR on purchases, the cash advance rate might be 23 or 24 percent. Interest accrues from the day you withdraw the cash — there is no interest-free period like there is for regular purchases. If you withdraw $500 at 24 percent APR and pay it back over three months, you will pay roughly $30 in interest on top of the $15 to $25 fee.
Here is a concrete example: You take out a $500 cash advance. Your card charges a 4 percent fee ($20) and 23 percent APR. If you pay back $200 per month starting the next month, you will pay approximately $20 in fees plus $23 in interest — a total extra cost of $43 on a $500 withdrawal.
How a cash advance affects your credit card balance and payment
The cash advance amount counts toward your credit limit. If your limit is $5,000 and you take out a $500 cash advance, you now have $4,500 available to spend. The cash advance appears on your statement as a separate line item, distinct from regular purchases.
When you make a payment to your credit card, the payment is applied to your debts in a specific order set by law. Payments go first to the lowest-interest debt, then to higher-interest debt. Since a cash advance carries the highest interest rate on your card, it is paid off last. This means if you have both regular purchases and a cash advance on your card, your payment will cover the purchase interest first, and the cash advance will keep accruing interest longer.
If you want to pay off the cash advance faster, you can contact your card issuer and ask them to explore extra payments directly to the cash advance balance. Some issuers allow this; others do not. It is worth asking.
When a cash advance makes sense and when it does not
A cash advance makes sense only in narrow situations: you need cash when ready, you have no other way to get it, and you can pay it back within a month or two. Examples include a family emergency where you need cash for travel, or a situation where a vendor will not take a card.
A cash advance does not make sense if you are using it to cover regular expenses, to pay off other debt, or if you cannot pay it back quickly. If you are short on money each month, a cash advance will make the problem worse, not better, because the interest and fees will add to your debt. If you are considering a cash advance to pay another credit card or a loan, stop and talk to a financial counselor first — there are usually better options.
If you find yourself needing cash advances regularly, that is a sign to look at your budget. You may need to cut expenses, increase income, or find a cheaper way to access cash — like opening a checking account with an ATM card.
Alternatives to a cash advance
Before you take a cash advance, consider these options:
- Debit card or ATM card: If you have a checking account, use the debit card or ATM card tied to it. There is no fee and no interest.
- Borrow from a friend or family member: If possible, ask someone to lend you the cash with no interest or a low interest rate you agree on in advance.
- Delay the purchase: If the cash is for something you want but do not need when ready, wait until you have the money in your checking account.
- Use a personal loan: If you need a larger amount, a personal loan from a bank or credit union usually has a lower interest rate than a credit card cash advance, though it takes longer to process.
- Ask your employer for an advance: Some employers will advance you a portion of your next paycheck if you are in a bind.
Frequently Asked Questions
Does a cash advance hurt my credit score?
A cash advance itself does not hurt your score, but it increases your credit utilization — the percentage of your limit you are using. If your utilization goes above 30 percent, it can lower your score slightly. The bigger risk is if you cannot pay the cash advance back and your balance grows, which will hurt your score more over time.
Can I get a cash advance if my credit card is maxed out?
No. A cash advance counts toward your credit limit, so you can only withdraw up to the amount of available credit you have left. If your card is maxed out, you cannot take a cash advance.
What is the difference between a cash advance and a balance transfer?
A cash advance gives you physical cash. A balance transfer moves debt from one card to another. Balance transfers usually have lower fees and interest rates than cash advances, but they take several days to process and only work if you are moving existing debt, not getting new cash.
Can I use a credit card cash advance to pay off another credit card?
Technically yes, but it is almost never a good idea. You are paying a cash advance fee plus high interest to pay off debt that may have a lower interest rate. Talk to a credit counselor or your card issuer about a balance transfer or payment plan instead.
How long does a cash advance stay on my credit report?
The cash advance itself does not appear on your credit report. Only the balance and payment history matter. Once you pay off the cash advance, it stops affecting your credit. If you miss payments, that missed payment will show on your report for seven years.