The three ways to get cash from a credit card
You can get cash from a credit card in three ways: a cash advance at an ATM or bank, a balance transfer check mailed to you by your card issuer, or a cash-like purchase through services like PayPal or Square Cash. Each one costs differently and affects your credit differently, so the cheapest option depends on which card you have and how quickly you need the money.
A cash advance is the fastest — you walk to an ATM, insert your card, and withdraw money within minutes. A balance transfer check takes a week or two to arrive by mail. A cash-like purchase (sometimes called a "money transfer") can happen in hours if you use a mobile app. But all three charge you a fee upfront, and all three charge interest from day one — unlike a regular purchase, which gives you a grace period.
Key Takeaways
- Cash advances charge a fee (usually 3 to 5 percent of the amount) plus interest starting when ready, with no grace period like a regular purchase has.
- Balance transfer checks arrive by mail in one to two weeks and may have a lower fee than an ATM cash advance, but you still pay interest from day one.
- Cash-like purchases through PayPal or Square Cash are sometimes cheaper than a cash advance if your card offers a promotional rate, but read the terms carefully.
- The interest rate on cash advances is often higher than your regular purchase rate, sometimes by 5 percentage points or more.
- Paying back a cash advance does not lower your credit card balance faster — your payments go to the lowest-interest debt first, so the cash advance sits and accrues interest.
Cash advances at an ATM or bank
A cash advance is the most common way to pull money from a credit card. You go to an ATM that accepts your card (or walk into a bank branch), enter your PIN, and withdraw cash up to your credit limit. The money is in your hand when ready.
The cost is steep. You pay a cash advance fee — usually 3 to 5 percent of the amount you withdraw, with a minimum of $2 to $10. If you withdraw $500, expect to pay $15 to $25 just to get the cash. On top of that, your card issuer charges interest on the full amount starting the day you withdraw it. There is no grace period. If your regular purchase rate is 18 percent, your cash advance rate might be 23 or 24 percent. That interest compounds daily.
Your credit card statement will show the cash advance as a separate line item from your regular purchases. When you make a payment, your card issuer applies it to whichever balance has the lowest interest rate first — usually your regular purchases. Your cash advance sits there accruing interest while you pay down the cheaper debt. This is why a $500 cash advance can cost you $50 or more in interest alone if you take three months to pay it back.
Balance transfer checks
Some credit card issuers mail you checks tied to your credit line. You write a check to yourself or to someone else, deposit it like a regular check, and the amount is charged to your credit card as a cash advance. The fee and interest work the same way as an ATM cash advance — you pay a percentage fee upfront and interest from day one.
The advantage is that the fee is sometimes lower. An ATM cash advance might cost 5 percent, but a balance transfer check might cost 3 percent. The disadvantage is timing: the check takes one to two weeks to arrive by mail, and then the recipient has to deposit it. If you need cash today, this does not work.
Balance transfer checks also come with promotional offers sometimes — a 0 percent interest rate for three to six months, for example. Read the fine print carefully. The 0 percent rate usually applies only to the balance transfer amount, not to regular purchases. And if you miss a payment during the promotional period, the rate jumps to the regular rate retroactively.
Cash-like purchases through payment apps
Services like PayPal, Square Cash, and Venmo let you send money to yourself or to someone else using your credit card. The money lands in your account (or theirs) within hours. To your credit card issuer, this looks like a purchase, not a cash advance, so you might avoid the cash advance fee entirely.
The catch is that many card issuers now charge a fee for this too — they have caught on to the workaround. Some charge 3 percent, some charge nothing. Check your card's terms or call the issuer before you try this. If your card does not charge a fee for money transfers, you still pay interest from day one, just like a cash advance, but at your regular purchase rate instead of a higher cash advance rate. That can save you money if your cash advance rate is significantly higher.
This method works best if you are sending money to someone else anyway — say, splitting rent with a roommate. You are not paying extra for the transfer itself, just the interest on the credit card balance.
How the interest adds up
Let's say you take a $500 cash advance at 24 percent interest with a 4 percent fee. You pay $20 upfront in fees. If you pay back the full $500 in one month, you owe about $10 in interest, for a total cost of $30. If you take three months to pay it back, you owe about $30 in interest, for a total cost of $50. If you take six months, you owe about $60 in interest.
Compare that to a balance transfer check with a 3 percent fee and a 0 percent promotional rate for six months. You pay $15 upfront, then nothing in interest for six months. After six months, if you have not paid it off, the regular rate kicks in and you start accruing interest. This is why the promotional offer matters — it gives you time to pay the money back without interest piling up.
The real cost of a cash advance is not the fee alone. It is the fee plus the interest, and the interest depends on how long you carry the balance. If you need cash for an emergency and can pay it back within a month, the total cost might be acceptable. If you are going to carry the balance for months, a cash advance is expensive compared to other ways to borrow.
Alternatives to a credit card cash advance
Before you take a cash advance, consider whether you have other options. A personal loan from a bank or credit union usually charges less interest than a cash advance and does not have an upfront fee. A payday loan is faster but often more expensive. Borrowing from family or friends costs nothing but can strain the relationship. A line of credit from your bank might be cheaper than a cash advance if you have one already set up.
If you have multiple credit cards, check whether any of them offer a 0 percent promotional rate on balance transfers or cash advances. Some cards aimed at people rebuilding credit offer this. The promotional period is usually three to six months, which gives you a window to pay the money back without interest.
If you are in a true emergency — you need cash today and have no other option — a cash advance is faster than a personal loan. But if you have a few days, a personal loan is usually cheaper over time.
How a cash advance affects your credit score
A cash advance does not hurt your credit score directly. Your issuer reports it to the credit bureaus as part of your overall credit card balance, not as a separate negative mark. However, a cash advance does increase your credit utilization ratio — the percentage of your available credit that you are using. If you have a $5,000 limit and take a $500 cash advance, your utilization jumps from 0 percent to 10 percent (or higher if you already had a balance). High utilization can lower your score by a few points.
The bigger risk is that a cash advance makes it harder to pay down your balance. Because the interest rate is high and your payments go to the lowest-interest debt first, the cash advance lingers on your card. A lingering balance keeps your utilization high for longer, which keeps your score lower for longer.
Frequently Asked Questions
Can I use a credit card cash advance to pay off another credit card?
Yes, but it is usually a bad idea. You are paying a cash advance fee and a high interest rate to move money from one card to another. A balance transfer — moving the balance directly from one card to another without taking cash out — is cheaper because it has a lower fee and often a promotional 0 percent rate. If you want to consolidate debt, a balance transfer or a personal loan is smarter than a cash advance.
What is the difference between a cash advance and a balance transfer?
A cash advance gives you cash in hand. A balance transfer moves a balance from one card to another. A cash advance charges a higher fee and a higher interest rate. A balance transfer often comes with a promotional 0 percent rate for a few months. If you need actual cash, you need a cash advance. If you are moving debt between cards, a balance transfer is cheaper.
Do I have to use my PIN to get a cash advance?
At an ATM, yes. At a bank branch, you can usually show your ID instead. Some banks let you get a cash advance at the teller window without a PIN if you can prove you are the cardholder. Call your card issuer or visit a branch to ask what they require.
Can I get a cash advance if my credit card is maxed out?
No. A cash advance counts against your credit limit, just like a purchase does. If you have used your full limit, you cannot take a cash advance unless you pay down the balance first or your issuer raises your limit.
Will paying off a cash advance faster lower my interest charges?
Yes. Interest on a cash advance compounds daily, so the faster you pay it back, the less interest you owe. If you can pay back a $500 cash advance in two weeks instead of two months, you will save money on interest. But your minimum payment will go to the lowest-interest balance first, so you may need to make an extra payment specifically toward the cash advance to pay it off faster.