Yes, you can withdraw cash from an ATM with a credit card, but it costs you money and works differently than a debit card
Most credit cards let you take cash out at an ATM, but the bank treats it as a loan, not a withdrawal from your own account. The moment you press "confirm" on that ATM screen, you start paying interest — usually at a higher rate than your regular purchase APR. You also pay an immediate fee, often $3 to $5 per transaction, plus whatever fee the ATM operator charges. This is called a cash advance, and it is one of the most expensive ways to use a credit card.
The reason credit card companies charge more for cash advances is that they see the risk differently. When you buy something with a card, the merchant guarantees the transaction. When you take cash, there is no merchant, no receipt, no proof of what you did with the money. From the lender's perspective, you are borrowing unsecured money on the spot. That risk costs you.
Key Takeaways
- A cash advance on a credit card starts accruing interest immediately, with no grace period like you get on purchases.
- You pay both a cash advance fee (usually 3 to 5 percent of the amount withdrawn) and any ATM operator fee on top of interest charges.
- The APR on cash advances is typically 5 to 10 percentage points higher than your purchase APR, and this varies by card and by your creditworthiness.
- If you need cash regularly, a debit card, a bank withdrawal, or a personal loan will cost you far less than repeated credit card cash advances.
How the cash advance fee and interest work together
When you withdraw $200 from an ATM using your credit card, you do not just owe $200. You owe the $200 plus a cash advance fee. If your card charges 4 percent, that is $8 right there. Then interest starts accruing the same day — not at the end of the month like a purchase, but immediately. If your cash advance APR is 25 percent (which is common), you are paying roughly 68 cents per day on that $200 until you pay it back.
The fee is a one-time hit, but the interest compounds. If you keep that $200 borrowed for a month, you will owe roughly $20 in interest alone, plus the $8 fee. That is a $28 cost on a $200 withdrawal — 14 percent of the money you took out. For comparison, a personal loan from a bank or credit union might charge 10 to 15 percent APR with no upfront fee, and you would pay interest only on the balance you still owe.
Why your cash advance APR is higher than your purchase APR
Your credit card agreement lists two different interest rates: one for purchases and one for cash advances. The cash advance rate is almost always higher. This is not a mistake or a hidden fee — it is in your cardholder agreement, though many people do not notice it until they take a cash advance.
The difference exists because the credit card company sees cash advances as riskier. A purchase is tied to a specific merchant and a specific item. A cash advance is just money in your hand, and the lender has no way to know what you will do with it or whether you will be able to pay it back. To offset that risk, they charge more. The exact difference varies by card, but 5 to 10 percentage points is typical. If your purchase APR is 18 percent, your cash advance APR might be 25 or 28 percent.
How to find your card's cash advance terms before you need them
Your credit card statement or online account dashboard will show your cash advance APR and fee. Look for a section labeled "APRs and Fees" or "Rates and Fees." The cash advance fee is usually listed as a percentage (3 to 5 percent is standard) with a minimum dollar amount — often $5 or $10 — and sometimes a maximum. So a card might charge "the greater of 3 percent or $5," meaning if you withdraw $100, you pay $5, not $3.
If you cannot find this information online, call the customer service number on the back of your card and ask for your cash advance APR and the fee structure. Write it down. Knowing these numbers before you need cash means you can decide whether a cash advance makes sense or whether you should find another way to get money.
When a cash advance might make sense (and when it does not)
A cash advance is rarely the right choice, but there are narrow situations where it might be. If you are in a true emergency — your car broke down and you need cash to pay a mechanic before you can get to your bank — and you have no other way to get money, a cash advance is better than nothing. You will pay for the convenience, but at least you solve the immediate problem.
A cash advance does not make sense if you are taking it out of habit or because you prefer cash. If you regularly need cash, switch to a debit card or a checking account withdrawal. If you are considering a cash advance to pay off another debt, stop. You are borrowing at 25 percent APR to pay off a debt that probably costs less. If you need a larger amount of money — say, $1,000 or more — a personal loan from a bank, credit union, or online lender will almost always be cheaper, even if the APR looks similar, because you avoid the upfront fee and you have a fixed repayment schedule.
What happens to a cash advance on your credit report and credit score
A cash advance appears on your credit card statement like any other transaction, but it affects your credit in two ways. First, it counts toward your credit utilization — the percentage of your total credit limit that you are using. If you have a $5,000 limit and you take a $500 cash advance, your utilization jumps to 10 percent. High utilization can lower your credit score, even if you pay the balance off quickly.
Second, if you carry the cash advance balance month to month without paying it off, the interest charges add to your balance, which increases your utilization further and costs you more money. Unlike a purchase, there is no grace period. Interest starts the moment you take the cash, so carrying a balance is expensive from day one.
Alternatives to a credit card cash advance
If you need cash, consider these options first. A debit card withdrawal from your own bank account costs nothing and takes seconds. If you do not have a debit card, open a checking account — most banks offer them free. If you need cash outside of business hours, use your bank's ATM or a network ATM (many banks belong to networks like Allpoint or MoneyPass that let you withdraw from thousands of ATMs for free).
If you need a larger amount and cannot wait until the bank opens, a personal loan from a credit union or online lender might be faster and cheaper than a cash advance. Credit unions often have lower rates and more flexible terms than banks. Online lenders can fund a loan in one to three business days. Even a payday loan, which is expensive, is sometimes cheaper than a cash advance if you repay it within two weeks.
Frequently Asked Questions
Does taking a cash advance hurt my credit score?
Yes, in two ways. It increases your credit utilization immediately, which can lower your score. And if you carry the balance, the interest charges grow your debt, which keeps utilization high. The damage is usually temporary if you pay it off quickly, but it is real.
Can I use a credit card to withdraw cash from my bank's teller window?
No. A teller will not process a credit card as a withdrawal. You can only take a cash advance at an ATM or by using a convenience check (if your card offers them), which also counts as a cash advance and carries the same fees and interest.
What if I do not pay back a cash advance?
The balance stays on your credit card and accrues interest every day. If you do not pay, the card issuer will report the late payment to credit bureaus, which damages your credit score. After 180 days of non-payment, the card issuer may charge off the debt and sell it to a collection agency, which can pursue you legally.
Is the cash advance fee the same as the ATM fee?
No. The cash advance fee is charged by your credit card company. The ATM fee is charged by the ATM operator (usually $2 to $3) and is separate. You pay both. Some ATMs owned by your bank are free, but most third-party ATMs charge a fee.
Can I avoid the cash advance APR by paying it back immediately?
No. Interest starts accruing the moment you take the cash, even if you pay it back the next day. You will still owe the cash advance fee and at least one day of interest. This is why cash advances are expensive even for short-term borrowing.