You can withdraw cash from a credit card, but it costs more than a regular purchase

A cash advance is when you use your credit card to get cash from an ATM, bank teller, or convenience store. The money comes from your credit line, not a separate account. Unlike a purchase, a cash advance charges you a fee upfront (usually 3 to 5 percent of the amount you withdraw) and starts charging interest immediately — there is no grace period like there is for regular purchases.

Most people should avoid cash advances unless they have no other option. The combination of the upfront fee and high interest rate makes them one of the most expensive ways to borrow money on a credit card. If you need cash, a debit card withdrawal, a personal loan, or borrowing from someone you trust will almost always cost you less.

Key Takeaways

  • Cash advances charge a fee (typically 3 to 5 percent) plus a higher interest rate than regular purchases, with no grace period before interest starts.
  • You can withdraw cash at an ATM using your credit card PIN, at a bank teller with your card and ID, or sometimes at a convenience store through a cash-back transaction.
  • The interest rate on a cash advance is usually higher than your regular purchase APR and begins accruing the day you withdraw the money.
  • Paying back a cash advance takes longer because your regular payments go toward purchases first, leaving the cash advance balance to accrue interest longer.

Three ways to get cash from your credit card

The most common method is using an ATM. Insert your credit card, enter your PIN (which you may need to set up if you have never done a cash advance before), and withdraw the amount you need. The ATM will show you the fee before you confirm the transaction.

You can also visit a bank branch in person. Bring your credit card and a photo ID. Tell the teller you want a cash advance. They will process it at the counter, charge the fee, and hand you the cash. This method works even if the bank is not the one that issued your card, though some banks charge an additional fee for this service.

A third option is a convenience store or grocery store that offers cash back. You make a small purchase (or sometimes just ask without buying anything) and request cash back on your credit card. This avoids an ATM fee in some cases, but the store may still charge you, and your card issuer will still charge their cash advance fee.

What the fees and interest actually cost you

The upfront fee is straightforward: if you withdraw $200 and the fee is 4 percent, you pay $8 immediately. You now owe $208 on your credit card.

The interest rate is where the real cost adds up. Most credit cards charge a higher APR for cash advances than for regular purchases. If your purchase APR is 18 percent, your cash advance APR might be 24 or 25 percent. Unlike a purchase, interest starts accruing the day you withdraw the money — there is no 21-day grace period.

Here is a concrete example: you withdraw $500 at a 4 percent fee ($20) with a 24 percent cash advance APR. If you pay $100 per month, it takes you six months to pay it back. You will pay roughly $60 in interest on top of the $20 fee. Your total cost for borrowing $500 is $80.

How cash advances affect your credit card balance and payments

When you make a payment to your credit card, the payment goes toward your regular purchases first, not your cash advance. This means your cash advance balance sits there accruing interest while you pay down your purchases. If you have both a $500 purchase balance and a $500 cash advance balance, and you send in $200, that $200 goes entirely to the purchase. The cash advance keeps charging interest.

This is why cash advances are so expensive over time. You cannot pay them off quickly by making a regular payment — you have to pay off all your purchases first, or make a payment large enough to cover both. Check your credit card statement to see how much of each payment goes to each type of balance.

When a cash advance might make sense

A cash advance is rarely the right choice, but there are narrow situations where it might be the least bad option. If you have an emergency and truly have no other way to get cash — no savings, no access to a personal loan, no friends or family to borrow from — a small cash advance for a short time might be better than missing a critical payment or going without food.

Even then, make a plan to pay it back as fast as possible. The longer you carry the balance, the more interest you pay. If you can pay it back within a month or two, the total cost is lower than if you let it sit for six months.

Do not use a cash advance to fund a purchase you could make with the card itself. Do not use it to pay off other debts unless that debt has an even higher interest rate (which is rare). Do not use it because you want cash on hand — that is not an emergency.

Alternatives that cost less

If you need cash, explore these options first. A debit card withdrawal from your own bank account costs nothing and charges no interest. A personal loan from a bank or credit union usually has a lower interest rate than a cash advance, even if you have fair credit. Asking a friend or family member to lend you money costs nothing if you pay them back on time.

If you need cash regularly, a debit card or a basic savings account at a bank or credit union is the right tool, not a credit card. If you are in a financial crisis and need cash for rent, food, or utilities, look into local assistance programs or nonprofits in your area — many offer emergency funds or grants that do not require repayment.

How to set up or reset your cash advance PIN

Most credit cards require a PIN to withdraw cash at an ATM. If you have never done a cash advance, you may not have set one up yet. Call the number on the back of your card and ask the issuer to set a PIN for you. They will usually let you choose a four-digit number over the phone, or they may mail you a temporary PIN that you change on your first withdrawal.

If you forget your PIN, call the same number and ask to reset it. The issuer will verify your identity and either give you a new PIN over the phone or mail one to you. This process usually takes a few minutes to a few days depending on the card issuer.

Frequently Asked Questions

Does a cash advance show up on my credit report?

The cash advance itself does not show up as a separate line item on your credit report. It is part of your overall credit card balance and credit utilization. However, if you carry the balance and miss payments, those missed payments will show up on your report and hurt your credit score.

Can I use a credit card cash advance to pay another credit card bill?

Technically yes, but it is a bad idea. You are borrowing at a high interest rate (the cash advance rate) to pay off a debt at a lower interest rate (your other card's purchase rate). You are also paying the cash advance fee on top. If you need to move money between cards, look into a balance transfer instead, which usually has a lower fee and interest rate.

What happens if I cannot pay back the cash advance?

The balance stays on your credit card and keeps accruing interest. If you miss payments, your credit score drops and the card issuer may increase your interest rate or close your account. After several months of missed payments, the issuer may send the debt to a collection agency. Contact your card issuer as soon as you know you cannot pay — they may offer a hardship program or payment plan.

Is there a limit to how much I can withdraw?

Yes. Your credit card issuer sets a cash advance limit, which is usually lower than your overall credit limit. You can find this limit in your card agreement or by calling the issuer. Some cards have a cash advance limit of $500 even if your credit limit is $5,000.

Do I pay the cash advance fee every time I withdraw?

Yes. Each withdrawal is a separate transaction and charges its own fee. If you withdraw $100 three times, you pay the fee three times. This is another reason to avoid multiple small cash advances — make one larger withdrawal if you need cash.