You can get cash from a credit card through an ATM, bank teller, or cash advance check, but each method charges fees and interest that start when ready
A cash advance is when you withdraw money directly from your credit card's available balance, the same way you would from a debit card or bank account. The money goes into your pocket or bank account right away. But unlike a purchase, a cash advance starts charging interest the moment you take it — there is no grace period — and the fees are steep enough that this should be your last resort for getting cash, not your first.
The three main ways to get cash are: using an ATM with your credit card, going to a bank teller and asking for a cash advance, or depositing a cash advance check (if your card issuer sent you one). All three trigger the same costs: a cash advance fee (usually 3 to 5 percent of the amount, with a minimum of $5 to $10), plus interest that accrues daily at a rate that is often higher than your regular purchase rate.
Key Takeaways
- Cash advances charge a fee (typically 3 to 5 percent) plus interest that starts when ready, with no grace period like purchases have.
- The interest rate on a cash advance is usually 2 to 5 percentage points higher than your regular purchase APR.
- Using an ATM is the fastest method, but a bank teller or cash advance check may have lower fees depending on your card.
- The money you pay back goes to the cash advance balance first, separate from any purchase balance you carry.
- If you need cash urgently, a personal loan or borrowing from family costs far less than a credit card cash advance.
The real cost: fees and interest rates
When you take a cash advance, you pay two separate charges. The first is the cash advance fee, which your card issuer charges upfront. This is usually 3 to 5 percent of the amount you withdraw, though some cards charge a flat fee instead (like $10 per advance). If you withdraw $500 at 4 percent, you pay $20 when ready. That $20 is added to what you owe.
The second charge is interest, which starts accruing the day you take the cash. Unlike a purchase, which often has a 21 to 25 day grace period before interest kicks in, a cash advance has zero grace period. Interest compounds daily. The rate is usually 2 to 5 percentage points higher than your regular purchase APR. If your purchase rate is 18 percent, your cash advance rate might be 23 percent. On a $500 advance, that is roughly $9.58 in interest after one month, plus the $20 fee you already paid.
The total cost grows fast. A $500 cash advance at 4 percent fee plus 23 percent APR costs you $20 upfront plus about $115 in interest over a year if you make no payments. That is 27 percent of the original amount, just to hold the cash for twelve months.
Three ways to withdraw cash and which costs the least
The method you choose affects how much you pay, though all three trigger the same fee and interest rate.
| Method | How it works | Speed | Fee notes |
|---|---|---|---|
| ATM withdrawal | Insert your credit card at any ATM and withdraw cash like a debit card | when ready | Your card issuer charges the cash advance fee; the ATM operator may charge an additional ATM fee ($1 to $3) |
| Bank teller | Walk into a bank branch and ask for a cash advance on your credit card | when ready | Only your card issuer's fee applies; no ATM operator fee |
| Cash advance check | Deposit or cash a check your card issuer mailed you | 1 to 3 days | Only your card issuer's fee applies; no ATM operator fee |
If your card issuer charges a 4 percent fee and you withdraw $500, you pay $20 no matter which method you use. But if you use an ATM that charges its own fee, you pay an extra $1 to $3 on top. A bank teller or cash advance check avoids that extra charge, so if you have time, either of those is cheaper.
Some card issuers offer lower cash advance fees to certain cardholders or in certain situations — for example, 0 percent for the first 30 days, or a flat $5 fee instead of a percentage. Check your card's terms or call the number on the back to ask what your specific rate and fee are before you withdraw.
How cash advances affect your credit and your other balances
A cash advance does not show up as a separate line item on your credit report the way a purchase does. But it does increase your overall credit card balance and your credit utilization ratio — the percentage of your total credit limit that you are using. If you have a $5,000 limit and a $2,000 purchase balance, your utilization is 40 percent. A $500 cash advance raises it to 50 percent. Higher utilization can lower your credit score, especially if you are already carrying a balance.
The cash advance balance is also tracked separately from your purchase balance inside your account. When you make a payment, your card issuer applies it to the balance with the highest interest rate first — usually the cash advance. This means if you have both a purchase balance and a cash advance balance, your payment goes to the cash advance first, and the purchase balance keeps accruing interest. This is the opposite of what you might expect, and it makes carrying both balances very expensive.
Cheaper alternatives if you need cash urgently
Before you take a cash advance, consider whether one of these options costs less or works for your situation.
A personal loan from a bank, credit union, or online lender usually has a lower interest rate than a credit card cash advance — often 6 to 36 percent depending on your credit score and the lender. The fee is typically 1 to 6 percent, charged upfront. On a $500 loan at 15 percent APR with a 3 percent fee, you pay $15 upfront plus about $37.50 in interest over a year. That is half the cost of a cash advance. Personal loans also have a fixed repayment schedule, so you know exactly when you will be done paying.
A payday loan or title loan is faster but much more expensive than a personal loan — often 400 percent APR or higher. Avoid these unless you have no other option.
Borrowing from family or friends costs nothing if they agree to it, though it can strain the relationship if you do not repay on time. If you do borrow, put the terms in writing: the amount, the repayment date, and whether there is interest.
If you need cash for an emergency expense, some employers offer paycheck advances or loans through your workplace benefits program. These are usually free or very low-cost. Ask your HR or payroll department whether your employer offers this.
What happens if you cannot pay back the cash advance
If you take a cash advance and do not pay it back, the interest and fees keep growing, and the balance is reported to the credit bureaus as part of your overall credit card debt. Your credit score drops as the balance grows and your utilization rises. If you miss payments, the card issuer can charge late fees (usually $25 to $40 for the first late payment, more for repeat ones) and may raise your interest rate to the penalty rate, which can be 29 percent or higher.
After 180 days of missed payments, the card issuer may close your account and send the debt to a collection agency. At that point, the collector can sue you for the balance, and if they win, they can garnish your wages or put a lien on your bank account (depending on your state). This is why taking a cash advance you cannot afford to repay quickly is so risky.
If you are already struggling with credit card debt, taking a cash advance makes it worse. A credit counselor at a nonprofit credit counseling agency can help you make a plan to pay down what you owe without taking on more debt. The National Foundation for Credit Counseling (NFCC) and Financial Counseling Association of America (FCAA) both have directories of agencies near you that offer free or low-cost counseling.
Frequently Asked Questions
Can I use a credit card cash advance to pay off another credit card?
Yes, but it is almost never a good idea. You are taking on a new debt with a higher interest rate and an upfront fee just to move money around. If you are trying to consolidate debt, a personal loan or balance transfer card (which charges 0 percent for a limited time) is much cheaper.
What is the difference between a cash advance and a balance transfer?
A balance transfer moves debt from one card to another and usually has a lower fee (0 to 3 percent) and a 0 percent introductory rate for 6 to 21 months. A cash advance puts cash in your hand when ready but charges a higher fee and interest from day one. Use a balance transfer to move existing debt; use a cash advance only if you need actual cash.
Does taking a cash advance hurt my credit score?
It can, because it increases your credit utilization ratio and adds to your total balance. The impact is usually small at first, but it grows if you carry the balance for months. Paying it off quickly minimizes the damage.
Can I get a cash advance on a debit card?
No. Debit cards draw from money you already have in your bank account. You can withdraw cash at an ATM or from a teller, but that is not a cash advance — you are just accessing your own money. There are no fees or interest charges.
What if my credit card does not allow cash advances?
Some cards, especially rewards cards or cards for people rebuilding credit, do not offer cash advances. Check your card's terms or call the number on the back to confirm. If your card does not allow them, you will need to use a different method to get cash, such as a personal loan or borrowing from family.