Yes, you can take cash out with a credit card, but it costs more than a regular purchase
Most credit cards let you withdraw cash at an ATM or get cash back at a store checkout. The card issuer treats this as a cash advance — a short-term loan separate from your regular credit line. You will pay an upfront fee (usually 3% to 5% of the amount withdrawn) plus a higher interest rate than you pay on purchases, and interest starts accruing immediately with no grace period.
The mechanics are straightforward: insert your card at an ATM, enter your PIN, and withdraw up to your cash advance limit (which is often lower than your credit limit). At a store, ask the cashier for cash back and the amount gets added to your transaction. The money appears in your account within one business day. What matters is understanding the real cost before you do it.
Key Takeaways
- Cash advances charge a fee of 3% to 5% upfront plus a higher interest rate than purchases, with no grace period.
- Your cash advance limit is set by the card issuer and is often lower than your overall credit limit.
- Interest starts accruing the day you withdraw the cash, not at the end of the billing cycle like purchase interest.
- Getting cash back at a store checkout costs nothing extra but still counts as a cash advance with the same fees and rates.
- For most situations, using a debit card or visiting your bank is cheaper than a credit card cash advance.
How cash advance fees and interest rates work
When you take a cash advance, you pay two separate costs. The first is a cash advance fee, charged upfront as a percentage of the amount withdrawn. This typically ranges from 3% to 5%, though some cards charge a flat dollar amount instead (like $10 minimum). A $300 cash advance at 4% costs $12 in fees alone.
The second cost is the cash advance interest rate, which is higher than your purchase APR. While a card might charge 18% APR on purchases, the cash advance rate could be 24% or higher. Unlike purchases, which often have a grace period (usually 21 to 25 days before interest kicks in), cash advance interest starts accruing the day you withdraw the money. If you carry the balance for a month, you are paying interest every single day.
The math adds up quickly. A $500 cash advance at a 4% fee ($20) plus 25% APR costs you $20 upfront and roughly $10 in interest for the first month if you do not pay it back immediately. That is $30 in costs on a $500 withdrawal — a 6% total cost in just 30 days.
Where you can withdraw cash and what counts as a cash advance
You can get cash in three main ways with a credit card. ATM withdrawals are the most obvious: find an ATM that accepts your card network (Visa, Mastercard, American Express, or Discover) and withdraw up to your cash advance limit. Some ATMs charge an additional operator fee on top of your card issuer's fee, so you might pay $5 to $6 total just to withdraw $100.
Cash back at checkout is often overlooked as a cash advance, but it is. When you ask a cashier for $40 cash back on a $60 purchase, that $40 counts as a cash advance and triggers the same fee and interest rate. The advantage is that you avoid the ATM operator fee, but you still pay your card issuer's cash advance fee and rate. Some cards waive the fee for cash back at their own bank's branches or partner locations — check your cardholder agreement to see if yours does.
Balance transfers from another card sometimes get lumped into cash advance rules, though they are technically different. A balance transfer moves debt from one card to another and usually has its own fee structure. Check your card's terms to see whether balance transfers are treated as cash advances or have separate terms.
Your cash advance limit versus your credit limit
Your card issuer sets a separate cash advance limit that is usually much lower than your overall credit limit. If your credit limit is $5,000, your cash advance limit might be $1,000 or $1,500. This limit protects the issuer by capping how much you can borrow at the higher cash advance rate.
You can find your cash advance limit in your cardholder agreement, in your online account portal, or by calling the customer service number on the back of your card. Some cards let you request a higher limit, though the issuer is not required to grant it. If you hit your cash advance limit, you cannot withdraw more until you pay down the balance.
When a cash advance makes sense and when it does not
A cash advance is rarely the cheapest option, but there are narrow situations where it might be your only choice. If you need cash for an emergency and have no other way to get it — no debit card, no nearby ATM for your bank account, no time to visit a branch — a credit card cash advance is faster than waiting for a loan or asking for a payday loan (which charges even higher rates). The key is paying it back as quickly as possible to minimize interest.
In most other situations, there are cheaper alternatives. A debit card withdrawal costs nothing if you use your own bank's ATM and usually $1 to $3 at another bank's machine. Visiting your bank branch in person is free. Asking a friend or family member for a short-term loan costs nothing. Even a payday loan, which is expensive, might be cheaper than a cash advance if you pay it back within two weeks.
Do not use a credit card cash advance to fund regular spending or to move money between accounts. The fees and interest make it an expensive way to access your own money, and it counts against your cash advance limit, which you might need for a genuine emergency.
How cash advances affect your credit and payment strategy
A cash advance does not directly hurt your credit score the way a late payment does, but it can indirectly damage your score by raising your credit utilization ratio. If you have a $5,000 credit limit and a $1,000 cash advance limit, and you withdraw $500 in cash, you are now using 10% of your cash advance limit and 10% of your overall credit limit. High utilization signals risk to credit scoring models, which can lower your score.
When you pay off a cash advance, the issuer applies your payment to the highest-interest debt first. This means if you have both a purchase balance and a cash advance balance, your payment goes toward the cash advance (which has the higher rate) before the purchase. This is actually in your favor — you are paying down the most expensive debt first. However, if you only make a minimum payment, you might not cover the full cash advance, and interest keeps accruing.
The best strategy is to pay off a cash advance in full as soon as possible. Do not let it sit on your card while you pay off purchases. If you cannot pay it back within a few days, reconsider whether you should have taken the advance in the first place.
Frequently Asked Questions
What is the difference between a cash advance and a balance transfer?
A cash advance withdraws money from your credit line as cash. A balance transfer moves debt from another card to your card. Both charge fees and have their own interest rates, but they are separate transactions. Cash advances are for getting physical cash; balance transfers are for moving existing debt between cards.
Can I avoid the cash advance fee by getting cash back at a store?
No. Cash back at checkout counts as a cash advance and triggers the same fee and interest rate as an ATM withdrawal. The only advantage is avoiding the ATM operator fee. Some cards waive the cash advance fee for cash back at their own bank branches, so check your terms.
Does taking a cash advance hurt my credit score?
Not directly, but it can indirectly lower your score by increasing your credit utilization ratio. A cash advance uses part of your credit limit, which signals higher risk to credit scoring models. The impact is usually small unless your utilization is already high.
What happens if I do not pay back a cash advance?
Interest keeps accruing at your cash advance rate (usually 24% or higher) until you pay it off. If you miss a payment, late fees apply and your credit score drops. The debt can eventually go to collections if unpaid long enough.
Is there a grace period for cash advance interest like there is for purchases?
No. Interest on a cash advance starts accruing the day you withdraw the money. There is no grace period. This is one of the biggest differences between cash advances and regular purchases.