The Three Ways to Get Cash From Your Credit Card
You can get cash from a credit card in three ways: a cash advance at an ATM using your PIN, a balance transfer to your bank account, or a cash-like transaction such as buying a money order or casino chips. The first two are the most common. A cash advance lets you withdraw money directly from your credit line at any ATM that accepts your card. A balance transfer moves credit available on one card to another card or bank account, though this is less common for cash and more often used to move debt between cards.
All three methods cost you money immediately. Cash advances charge a fee (usually 3 to 5 percent of the amount withdrawn, with a minimum of $5 to $10) and start accruing interest the same day—there is no grace period like there is for purchases. Balance transfers also charge a fee (typically 3 to 5 percent) and begin accruing interest right away. Because of these costs, getting cash from a credit card should be a last resort, not a routine way to access money.
Key Takeaways
- Cash advances charge an upfront fee of 3 to 5 percent plus interest that starts accruing immediately, with no grace period.
- Your credit card company sets a separate cash advance limit, which is often much lower than your overall credit limit.
- Interest rates on cash advances are typically higher than rates on purchases, sometimes 2 to 3 percentage points above your regular APR.
- Balance transfers to a bank account work similarly to cash advances in cost and timing, though some cards offer promotional periods with lower or zero interest.
How a Cash Advance Works at an ATM
To withdraw cash at an ATM, insert your credit card and enter your PIN. The ATM will show your available cash advance limit—not your full credit limit. You can withdraw up to that amount. The transaction posts to your account within one to three business days, and the fee appears on your next statement.
The fee is calculated on the amount you withdraw. If you withdraw $500 and the fee is 4 percent, you owe $20 in fees plus interest on the full $520 from the day of withdrawal. Interest accrues daily at your cash advance APR until the balance is paid off. Because there is no grace period, even a withdrawal you pay back within days will cost you interest.
Not all ATMs accept credit cards for cash advances. Bank ATMs that are part of your card issuer's network (for example, Chase ATMs if you have a Chase card) usually do. Independent ATMs and ATMs at other banks may decline the transaction or charge an additional ATM operator fee on top of your card issuer's fee. Always check the ATM screen before completing the transaction—it will show all fees.
Understanding Your Cash Advance Limit
Your cash advance limit is separate from your credit limit and is usually much lower. If your credit limit is $5,000, your cash advance limit might be $1,000 or $1,500. Your card issuer sets this limit based on your credit profile and account history. You can find your cash advance limit in your online account, on your statement, or by calling the customer service number on the back of your card.
You cannot increase your cash advance limit by requesting a higher credit limit. Some card issuers allow you to request a separate increase to your cash advance limit, but many do not. If you need more cash than your limit allows, you will need to use another method—a debit card, a personal loan, or a line of credit from a bank.
Interest Rates and Fees on Cash Advances
Cash advance APR is almost always higher than your purchase APR. If your card charges 18 percent APR on purchases, the cash advance APR might be 22 or 25 percent. This higher rate applies only to the cash advance balance, not to purchases you make on the same card.
The fee structure is straightforward but adds up quickly. Most cards charge either a flat fee (such as $10) or a percentage of the amount withdrawn (such as 4 percent), whichever is greater. A $100 withdrawal might cost $10 in fees; a $500 withdrawal might cost $20 (4 percent). Some cards charge both a percentage fee and a flat fee, though this is less common.
Interest begins accruing the day you withdraw the cash. If you withdraw $500 on the 15th and pay it back on the 20th, you still owe five days of interest at the daily rate. The daily rate is your APR divided by 365. At 24 percent APR, that is about 0.066 percent per day, or roughly $0.33 per day on a $500 balance.
Balance Transfers as a Cash Alternative
Some credit cards allow you to transfer your available credit directly to a bank account. This is called a balance transfer for cash or a convenience check. The process is similar to a cash advance: you request the transfer through your online account or by phone, and the money appears in your bank account within three to five business days.
Balance transfers charge a fee (typically 3 to 5 percent) and begin accruing interest immediately at your cash advance APR. The main difference from an ATM cash advance is that some cards offer a promotional period—for example, 0 percent APR for six months on balance transfers. If your card has this offer, a balance transfer can be cheaper than a cash advance, as long as you pay off the balance before the promotional period ends.
Check your card's terms to see whether balance transfers are available and whether a promotional rate applies. Not all cards offer this feature. If your card does, the offer may be limited to a certain number of transfers per year or a maximum transfer amount.
Other Ways to Get Cash-Like Value From Your Card
Some people use credit cards to buy items that function as cash: money orders, prepaid debit cards, or casino chips. These transactions are sometimes classified as cash advances by the card issuer, which means they trigger the cash advance fee and APR. Other times they are classified as purchases, which means they carry your regular purchase APR and may have a grace period.
The classification depends on the merchant code assigned to the seller. A grocery store selling money orders might code the transaction as a purchase; a casino might code it as a cash advance. You cannot control this classification. The safest approach is to assume any cash-like transaction will be treated as a cash advance and will cost you the fee and higher interest rate.
How to Avoid Needing a Credit Card Cash Advance
Cash advances are expensive because they combine an immediate fee, a higher interest rate, and no grace period. A $500 cash advance at 4 percent fee and 24 percent APR costs $20 upfront plus roughly $10 in interest if you pay it back in one month. Over a year, the same balance costs $120 in interest alone.
If you need cash, explore cheaper options first: a personal loan from a bank or credit union (typically 6 to 36 percent APR), a line of credit, a payday loan from a licensed lender (though these are also expensive), or borrowing from family or friends. If you have a debit card linked to a checking account, use that instead. If you do not have access to cash any other way, a cash advance is available, but plan to pay it back as quickly as possible.
Frequently Asked Questions
Will a cash advance hurt my credit score?
A cash advance itself does not appear on your credit report, but it increases your credit utilization ratio—the amount of available credit you are using. If you have a $5,000 credit limit and take a $1,000 cash advance, your utilization jumps to 20 percent. High utilization can lower your credit score temporarily. The effect disappears once you pay off the balance.
Can I use a credit card cash advance to pay another credit card bill?
Technically yes, but it is a bad idea. You would be paying a cash advance fee and interest rate to move money from one card to another, which costs more than simply paying the second card with your regular income or savings. If you are struggling to pay multiple cards, contact a nonprofit credit counselor instead.
What happens if I cannot pay back a cash advance?
The balance stays on your card and accrues interest at your cash advance APR. If you miss payments, late fees apply and your credit score drops. The card issuer can freeze your account or close it. If the debt goes unpaid long enough, it may be sold to a debt collector.
Is there a grace period for cash advances like there is for purchases?
No. Interest on a cash advance starts accruing the day you withdraw the money. There is no period during which you can avoid interest charges, even if you pay the balance in full before your statement due date.
Can I get a cash advance on a debit card?
No. Debit cards draw directly from your bank account and do not have a credit line. You can withdraw cash at an ATM using your debit card, but there is no fee or interest charge—you are simply accessing your own money.