Yes, you can withdraw cash using a credit card, but it costs more than a regular purchase
You can take cash out of an ATM or get it from a bank teller using your credit card. This is called a cash advance. The moment you withdraw the cash, your credit card issuer treats it as a loan and begins charging you interest — usually at a higher rate than your regular purchase APR. You also pay an upfront fee, typically 3 to 5 percent of the amount withdrawn.
Unlike a purchase, a cash advance does not get a grace period. Interest starts accruing immediately, even if you pay the full balance when your statement arrives. This makes cash advances significantly more expensive than using a debit card or paying with the credit card directly.
Key Takeaways
- Cash advances charge interest from day one with no grace period, and the interest rate is usually 2 to 5 percentage points higher than your purchase APR.
- You pay an upfront fee of 3 to 5 percent of the cash amount, charged to your account immediately.
- The cash advance APR and fee structure appear in your cardholder agreement under "Cash Advance Terms" or a similar heading.
- Payments you make go toward your lowest-APR balance first, so paying down a cash advance requires paying off purchases first or making payments above your minimum.
Where you can get a cash advance
You can withdraw cash at any ATM that displays your card network's logo — Visa, Mastercard, American Express, or Discover. You do not need a PIN if you are withdrawing at a bank branch where you have an account; you can ask the teller to process it as a cash advance. At an ATM, you will need the PIN you set up with your card issuer.
Some card issuers allow you to request a cash advance by phone or through their mobile app, and the funds are deposited into your bank account. This method avoids ATM fees but still charges the cash advance fee and interest rate. Check your cardholder agreement or call the number on the back of your card to see if this option is available.
Convenience stores, grocery stores, and other retailers sometimes offer cash back when you make a purchase with a credit card. This is not a cash advance — it is treated as a purchase and gets the same APR and grace period as other transactions. This is almost always cheaper than using an ATM.
The fees and interest you pay
A cash advance fee is charged the moment you withdraw the money. This fee is a percentage of the amount withdrawn, typically 3 to 5 percent, with a minimum dollar amount (often $5 to $10). If you withdraw $200, you might pay a $6 to $10 fee. If you withdraw $1,000, you might pay $30 to $50. The fee is added to your credit card balance.
The cash advance APR is separate from your purchase APR and is almost always higher. If your purchase APR is 18 percent, your cash advance APR might be 23 or 25 percent. This rate varies by card issuer and your creditworthiness. You can find the exact rate in your cardholder agreement or by calling your issuer.
Interest accrues daily from the moment you withdraw the cash. If you withdraw $500 on the 5th of the month and your cash advance APR is 24 percent, you owe roughly $10 in interest by the end of the month, even if you pay the full $500 before your statement closes. The longer you carry the balance, the more interest compounds.
How payments are applied to your balance
When you make a payment on a credit card with both purchases and a cash advance, the payment is applied to the balance with the lowest APR first. This means your payment goes toward your purchase balance before it touches the cash advance. This is a legal requirement under the Credit Card Accountability Responsibility and Disclosure Act (CARD Act).
If you want to pay down the cash advance specifically, you must pay more than your minimum payment. The extra amount goes toward the highest-APR balance — the cash advance. For example, if your minimum payment is $100 and you pay $150, the first $100 goes to purchases, and the extra $50 goes to the cash advance.
To avoid this trap, pay the cash advance off as quickly as possible. The longer it sits, the more interest you pay. If you carry a cash advance for several months, the interest can exceed the original fee.
ATM fees on top of cash advance fees
When you withdraw cash at an ATM that does not belong to your card issuer's network, you may pay an ATM operator fee in addition to the cash advance fee. This fee is charged by the ATM owner and typically ranges from $2 to $3. Your card issuer may also charge an out-of-network fee, usually $1 to $3.
Using an ATM owned by your card issuer's bank eliminates the operator fee. If you have a Visa card issued by Chase, for example, you can use any Chase ATM without an operator fee. You still pay the cash advance fee and interest, but you avoid the extra ATM charges.
Some credit cards marketed to frequent travelers or premium customers waive the cash advance fee or reimburse ATM fees. Check your cardholder agreement to see if your card offers this benefit. Most standard cards do not.
When a cash advance makes sense
A cash advance is expensive and should be a last resort. It makes sense only when you absolutely need cash and have no other option — for example, if you are traveling and your debit card is lost and you need money immediately. Even then, it is worth asking your bank to wire funds or issue a replacement card first.
A cash advance does not make sense for everyday spending. If you need cash to pay for groceries or gas, use your debit card or ask for cash back at checkout. If you are considering a cash advance to cover a shortfall in your budget, that is a sign you need to review your spending or look for other sources of income.
If you are in a situation where you regularly need cash advances to cover expenses, you may be carrying too much credit card debt. Consider speaking with a nonprofit credit counselor, who can review your budget and debt at no cost. The National Foundation for Credit Counseling (NFCC) maintains a directory of accredited counselors.
How a cash advance affects your credit
Taking a cash advance does not directly hurt your credit score, but carrying a high balance does. A cash advance increases your total credit card balance, which increases your credit utilization ratio — the percentage of your available credit you are using. If your utilization jumps from 30 percent to 50 percent, your score may drop.
The drop is usually temporary. Once you pay off the cash advance, your utilization drops and your score recovers. However, if the cash advance keeps you from paying your bill on time, a late payment will damage your score for years.
Cash advances also do not count toward rewards or cash back. If your card offers 2 percent cash back on purchases, you earn nothing on a cash advance. You pay the fee and interest with no benefit.
Frequently Asked Questions
What is the difference between a cash advance and a balance transfer?
A cash advance gives you physical cash and charges a fee plus a high APR from day one. A balance transfer moves debt from one card to another and may offer a 0 percent introductory APR for a set period. Balance transfers are for moving existing debt; cash advances are for getting cash. Both charge fees and should be used sparingly.
Can I get a cash advance if my card is maxed out?
No. A cash advance counts against your credit limit, just like a purchase. If your limit is $1,000 and you have a $900 balance, you can only advance $100. Some issuers allow you to request a temporary credit limit increase, but this requires a separate request and approval.
Do I have to use a PIN to get a cash advance at an ATM?
Yes. You set up a PIN when you open your credit card account. If you do not remember it, call the number on the back of your card to reset it. At a bank branch, you can withdraw cash without a PIN by showing your ID and the card.
What happens if I do not pay back a cash advance?
The balance carries over to your next statement and continues to accrue interest at the cash advance APR. If you miss a payment, your issuer may charge a late fee and report the missed payment to credit bureaus, damaging your score. If the debt goes unpaid for months, the issuer may close your account and send the debt to a collection agency.
Can I use a credit card cash advance to pay another credit card bill?
Technically yes, but it is a bad idea. You pay a cash advance fee and high APR to get the cash, then use it to pay another card. You are paying fees to move money between accounts. If you are struggling to pay multiple cards, contact a credit counselor instead.