Yes, you can withdraw money on a credit card, but it is not the same as using a debit card
You can withdraw cash from a credit card at an ATM, through a bank teller, or sometimes at a store checkout. The transaction is called a cash advance. Unlike a debit card withdrawal, which pulls from money you already have, a cash advance borrows money from your credit card issuer and creates a debt you must repay with interest.
The moment you withdraw the cash, interest begins accruing on that amount. Most credit card issuers charge a separate, higher interest rate for cash advances than they do for regular purchases — often 3 to 5 percentage points higher. You also pay an upfront fee, usually 3 to 5 percent of the amount withdrawn, charged immediately to your account.
Because of these costs, a cash advance should be a last resort, not a convenient way to get spending money. If you need cash regularly, a debit card or a visit to your bank is far cheaper.
Key Takeaways
- Cash advances charge interest from the day you withdraw the money, with no grace period like purchases receive.
- You pay an upfront fee of 3 to 5 percent of the amount withdrawn, in addition to the higher interest rate.
- The interest rate on cash advances is typically 3 to 5 percentage points higher than your purchase APR.
- You can withdraw cash at an ATM, through a bank teller, or at some retail locations, but each method may charge a different fee.
Where and how to withdraw cash on a credit card
The most common method is an ATM. Insert your credit card, enter your PIN, and select the cash advance option. Not all ATMs accept credit cards — many are set up for debit cards only — so you may need to visit an ATM owned by your card issuer's bank or a network ATM that accepts credit cards.
You can also visit a bank branch in person and ask a teller for a cash advance. Bring your credit card and a form of ID. The teller will process the transaction and hand you cash. This method works even if you do not have an account at that bank, though some banks charge an extra fee for non-customers.
Some retail stores allow cash advances at the checkout, though this is becoming less common. You would typically need to use a PIN-based system or sign a receipt. Ask the cashier whether your card is accepted for cash advances before attempting the transaction.
Each method may charge a different fee structure. An ATM fee might be $3 to $5 per transaction, plus the cash advance fee from your issuer. A bank teller might charge less or nothing if you use your own bank. Always check with your card issuer about which withdrawal methods are available to you and what fees apply.
Fees and interest charges that apply to cash advances
The cash advance fee is charged the moment you withdraw the money. It is calculated as a percentage of the amount withdrawn — typically 3 to 5 percent — and added to your balance immediately. If you withdraw $500, you might pay $15 to $25 in fees alone.
The interest rate on a cash advance is separate from your purchase APR and is usually higher. While your purchase rate might be 18 percent, your cash advance rate could be 23 or 24 percent. This higher rate applies from the day you withdraw the cash; there is no grace period. If you carry the balance for a month, you will owe interest for the full month, not just the days you held the cash.
Some credit card issuers also charge an ATM operator fee if you use an ATM outside their network. This fee goes to the ATM operator, not your card issuer, and is typically $2 to $3 per transaction. Your card issuer may or may not reimburse this fee — check your cardholder agreement.
The total cost of a $500 cash advance could easily be $50 to $75 in the first month alone, depending on your card's terms and the ATM you use. This is why cash advances are expensive compared to other ways of getting cash.
How cash advances affect your credit and account balance
A cash advance counts as a separate type of debt on your credit card account. It does not affect your credit score directly, but it does increase your overall balance and your credit utilization ratio — the amount of your total credit limit you are using. A higher utilization ratio can lower your credit score, especially if you are already carrying a high balance.
When you make a payment to your credit card, the payment is applied to your lowest-interest debt first. This means if you have both a purchase balance and a cash advance balance, your payment goes toward the purchase first, and the cash advance keeps accruing interest at the higher rate. This can make it harder to pay off the cash advance quickly.
Some card issuers allow you to specify how your payment is divided, but most do not. Check your cardholder agreement or call your issuer to understand how payments are applied to your account. If you have a cash advance, paying more than the minimum is important because the interest compounds daily.
Limits on how much you can withdraw
Your credit card issuer sets a cash advance limit, which is often lower than your total credit limit. For example, you might have a $5,000 credit limit but only a $1,500 cash advance limit. This limit is set by the issuer based on your creditworthiness and account history.
You can find your cash advance limit in your cardholder agreement, on your online account dashboard, or by calling your issuer's customer service number. If you need to increase your limit, you can request it, though the issuer is not required to grant the request.
The cash advance limit is separate from your available credit. If you have $2,000 available credit but a $1,000 cash advance limit, you can only withdraw up to $1,000 in cash, even though you could charge $2,000 in purchases.
Alternatives to cash advances that cost less
If you need cash, a debit card withdrawal from your own bank account costs nothing and does not create debt. This is the cheapest option if you have money in the bank.
A personal loan from a bank or credit union often has a lower interest rate than a credit card cash advance, even if you have fair credit. The interest rate is fixed, and you know exactly what you will pay. You also avoid the upfront cash advance fee.
A balance transfer to a card with a 0 percent introductory APR can be cheaper than a cash advance if you need to borrow money for a purchase, though balance transfers also charge a fee (usually 3 to 5 percent) and do not work for cash withdrawals.
If you are in a financial emergency, contact your card issuer about a hardship program. Some issuers offer lower interest rates or fee waivers for customers facing temporary hardship. This is not a formal program you can "apply" for in the traditional sense, but calling and explaining your situation may result in temporary relief.
What happens if you cannot repay a cash advance
If you do not repay a cash advance, it behaves like any other credit card debt. Interest continues to accrue at the higher cash advance rate, and the balance grows. If you miss payments, your issuer will report the missed payment to the credit bureaus, which will damage your credit score.
After 30 days of missed payments, your account may be flagged as delinquent. After 180 days, your issuer may charge off the debt, meaning they write it off as a loss and may sell it to a debt collection agency. A charge-off stays on your credit report for seven years and makes it difficult to borrow money in the future.
If you are struggling to repay a cash advance, contact your issuer as soon as possible. Explain your situation and ask about payment plans or hardship options. The earlier you reach out, the more options may be available to you.
Frequently Asked Questions
Does a cash advance show up on my credit report?
The cash advance itself does not appear as a separate line item on your credit report. However, if you miss payments or carry the balance for a long time, the missed payment or high utilization will show up and affect your credit score. Your credit card issuer reports your overall account activity, not individual transaction types.
Can I use a credit card cash advance to pay another credit card?
Technically yes, but it is a bad idea. You would pay the cash advance fee and higher interest rate on top of whatever you already owe on the other card. A balance transfer is cheaper if you want to move debt between cards, because the fee is lower and some cards offer 0 percent introductory rates.
What is the difference between a cash advance and a balance transfer?
A cash advance withdraws cash and charges a higher interest rate from day one with no grace period. A balance transfer moves debt from one card to another and may include a 0 percent introductory rate for a set period. Balance transfers are for moving existing debt; cash advances are for getting cash.
Can I get a cash advance if my credit card is maxed out?
No. A cash advance counts against your available credit, just like a purchase does. If you have no available credit, you cannot withdraw cash. You would need to pay down your balance first or request a credit limit increase.
Is there a way to avoid the cash advance fee?
No. The cash advance fee is charged by your issuer and is non-negotiable. Some cards marketed to people with poor credit charge higher fees, while premium cards may charge lower fees, but all credit cards charge a cash advance fee. The only way to avoid it is to not take a cash advance.