Yes, you can take cash from a credit card, but it costs more than a purchase
Most credit cards let you withdraw cash at an ATM or from a bank teller using your card's PIN. This is called a cash advance. The moment you take the money out, your card issuer charges you a fee — usually 3 to 5 percent of the amount — and starts charging interest on that cash when ready. There is no grace period like there is for purchases. If you take out $500, you might pay $15 to $25 just to get the cash, plus interest starting that day.
The interest rate on cash advances is also higher than the rate on regular purchases. Your purchase APR might be 18 percent, but your cash advance APR could be 24 percent or higher. That difference matters fast. After one month, a $500 cash advance at 24 percent costs you about $10 in interest alone, on top of the upfront fee.
Key Takeaways
- Cash advances charge an upfront fee of 3 to 5 percent and a higher interest rate than purchases, with no grace period.
- You can get a cash advance at an ATM using your PIN, at a bank teller, or sometimes through a convenience check your card issuer sends you.
- Your credit card statement will show the cash advance separately from purchases, and you must pay it down before the card pays off your purchases.
- If you need cash urgently, a personal loan, a line of credit, or a cash-back purchase at a store costs less than a credit card cash advance.
Where and how to take a cash advance
You can withdraw cash at any ATM that displays your card's logo — Visa, Mastercard, American Express, or Discover. Insert your card, enter your PIN, and select the cash withdrawal option. The ATM will show you the fee before you confirm, so you know the cost upfront.
You can also walk into a bank or credit union branch and ask a teller for a cash advance. Bring your card and ID. The teller will process it the same way an ATM does, and you will pay the same fee. Some card issuers also send convenience checks — blank checks tied to your credit card account. You write one like a regular check, and the amount counts as a cash advance with the same fees and interest.
Your card issuer sets a cash advance limit, which is often lower than your credit limit. You might have a $5,000 credit limit but only a $1,500 cash advance limit. Check your card's terms or call the number on the back of your card to find out what yours is.
How cash advances appear on your bill and affect payoff
Your credit card statement breaks down purchases and cash advances separately. If you owe $800 in purchases and $500 in cash advances, you will see both listed. The card issuer applies your payment to the lowest-interest debt first — which means your payment goes to purchases before it touches the cash advance.
This matters because the cash advance sits there accruing interest at a higher rate while your payment chip away at the purchase balance. If you pay $300 toward a $1,300 total balance, that $300 goes to the $800 purchase first, leaving the $500 cash advance untouched and growing interest. To pay off the cash advance faster, you have to pay more than the minimum or make a payment large enough to cover the purchases and then some.
Cash advances also count toward your credit utilization — the percentage of your total credit limit you are using. A $500 cash advance on a $5,000 limit raises your utilization to 10 percent, which can lower your credit score slightly. The effect is temporary and recovers once you pay it off.
The real cost: comparing cash advance fees and interest
A $500 cash advance with a 4 percent fee costs $20 upfront. At a 24 percent APR, after 30 days you owe an additional $10 in interest. After 90 days, the interest alone reaches $30. Over a year, if you only made minimum payments, you could pay $150 or more in interest and fees on that $500.
Compare that to other ways to get cash: a personal loan from a bank or credit union typically charges 6 to 36 percent APR with no upfront fee, and you know the exact payoff date. A cash-back purchase at a grocery store or pharmacy costs nothing — you buy a $20 item and ask for $100 cash back, paying only the price of the item. A line of credit from your bank works like a cash advance but usually at a lower rate and no upfront fee.
If you need cash for an emergency, the cash advance should be your last choice, not your first. Exhaust other options first: asking for a paycheck advance from your employer, borrowing from family, or using a personal loan.
When a cash advance might make sense
A cash advance is rarely the best choice, but there are narrow situations where it is the only option. If you are traveling internationally and your debit card stops working, a cash advance from your credit card at a foreign ATM might be your only way to get local currency and pay for a hotel or food. The fee and interest hurt, but they hurt less than being stranded.
If you have a true emergency — a car repair you need today to get to work — and you have no other way to pay, a small cash advance might be faster than waiting for a personal loan to be approved. But this should be rare. Most emergencies can wait a few days for a cheaper option.
Do not use a cash advance to pay off other debts, to fund a purchase you cannot afford, or to gamble or invest. These are signs that you need a budget or a conversation with a credit counselor, not a cash advance.
How to avoid needing a cash advance
The best strategy is to build a small emergency fund — even $500 to $1,000 — so you have cash on hand without borrowing. Set up automatic transfers to a savings account each payday, even if it is just $25. After a few months, you will have a buffer that costs you nothing.
Keep a debit card linked to a checking account with a small balance, separate from your credit card. Use it for cash withdrawals at your bank's ATM, where there is no fee. If you use another bank's ATM, you might pay $2 to $3, which is still far less than a credit card cash advance fee.
If you find yourself needing cash advances regularly, that is a sign your income does not cover your expenses. Talk to a nonprofit credit counselor — many offer free sessions — to build a spending plan. The National Foundation for Credit Counseling (NFCC) and the Financial Counseling Association (FCA) both have counselor directories on their websites.
Frequently Asked Questions
Does taking a cash advance hurt my credit score?
A cash advance raises your credit utilization, which can lower your score by a few points temporarily. The bigger hit comes if you carry the balance and miss payments. Once you pay it off, your score recovers. The cash advance itself does not show up as a separate item on your credit report — only the total balance does.
Can I get a cash advance with a debit card?
No. A debit card withdraws money directly from your checking account, so there is no advance or borrowing involved. You can withdraw cash at your bank's ATM for free, or at another bank's ATM for a small fee, but neither is a cash advance.
What happens if I cannot pay back a cash advance?
The balance stays on your card and keeps accruing interest. If you miss payments, your card issuer reports it to the credit bureaus, and your score drops. They may also lower your credit limit or close the account. If the debt goes unpaid long enough, they can sue you or send it to a collection agency.
Is there a limit to how much cash I can withdraw?
Yes. Your card issuer sets a cash advance limit, which is often lower than your credit limit. Some ATMs also have daily withdrawal limits — often $500 to $1,000 per day. If you need more, you can make multiple withdrawals over several days or ask a bank teller to process a larger advance.
Can I get a cash advance from a credit card I just opened?
Usually yes, but some card issuers restrict cash advances for new accounts or set a very low limit for the first 30 to 60 days. Check your card's terms or call the issuer to confirm your cash advance limit.