Taking cash out of a credit card is possible, but it is not the same as using the card to buy something

You can withdraw cash from a credit card at an ATM, bank teller, or through a cash advance at a store — but the moment you do, you start paying interest and fees that do not apply to regular purchases. There is no grace period. Interest begins accruing immediately, usually at a higher rate than your purchase APR. You will also pay an upfront fee, typically 3% to 5% of the amount you withdraw.

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 and the card company has a record of what you bought. When you withdraw cash, the money is yours to spend however you want, and the card company has no way to recover it if you do not pay back the balance. That higher risk is why they charge you for it.

Before you take out a cash advance, understand that it is almost always more expensive than other ways to get cash — a personal loan, a line of credit, or even a payday loan in some cases. It should be a last resort, not a convenience.

Key Takeaways

  • Cash advances charge an upfront fee (usually 3% to 5% of the amount) plus interest that starts immediately, with no grace period like purchases have.
  • The interest rate on cash advances is typically higher than your card's purchase APR and varies by card and by how much you withdraw.
  • You can get a cash advance at an ATM using your PIN, at a bank teller with your card and ID, or sometimes at a store checkout.
  • The total cost of a cash advance can exceed the cost of a personal loan or credit line, so compare your options before you withdraw.

Where you can withdraw cash from a credit card

The most common way is at an ATM. Insert your card, enter your PIN (which you may need to set up if you have never done it), and withdraw up to your cash advance limit — which is usually lower than your total credit limit. Not all ATMs charge the same fee; your card issuer may charge one fee, and the ATM operator may charge another, so you could pay $3 to $5 just to get the cash out.

You can also go to a bank branch and ask a teller for a cash advance. Bring your card and a photo ID. The teller will process it the same way an ATM does, but you may avoid the ATM operator fee — though your card issuer's fee still applies.

Some stores allow cash advances at the checkout, though this is less common than it used to be. Ask the cashier if they offer it; if they do, you typically do not pay an ATM fee, but you still pay your card issuer's cash advance fee.

How much the cash advance will cost you

The total cost has three parts: the upfront fee, the ATM fee (if applicable), and the interest.

The upfront fee is a percentage of the amount you withdraw. Most cards charge between 3% and 5%. If you withdraw $500, a 4% fee costs you $20 right away. This fee is added to your balance and you pay interest on it.

The ATM fee depends on which ATM you use. Your card issuer may charge $2 to $5 per withdrawal. The ATM operator may charge an additional $1 to $3. Using an ATM owned by your card issuer's bank usually costs less or nothing.

The interest rate on cash advances is almost always higher than your purchase APR. Where your purchases might be charged 15% APR, cash advances could be 20% or 25% or higher. The rate varies by card and by issuer, so check your card's terms or call the number on the back of your card to ask. Interest accrues daily from the moment you withdraw the cash, with no grace period. If you withdraw $500 at a 24% APR, you owe about $10 in interest after one month if you make no payment.

The longer you carry the balance, the more you pay. A $500 cash advance at 24% APR costs you roughly $120 in interest if you pay it back over one year.

How to set up your PIN and cash advance limit

Most credit cards require a PIN to withdraw cash at an ATM. If you have never set one up, you can usually do it online through your card issuer's website or app, or by calling the number on the back of your card. The PIN is typically four digits of your choice.

Your cash advance limit is separate from your credit limit. It is usually 20% to 30% of your total credit limit, but it varies by card. If your credit limit is $5,000, your cash advance limit might be $1,000 or $1,500. You can find your cash advance limit in your online account or by calling your card issuer. Some cards let you request a higher limit, but many do not.

Why a cash advance is usually not the best option

The fees and interest add up fast. A $500 cash advance at a 4% upfront fee, a $3 ATM fee, and a 24% APR costs you $23 immediately and roughly $10 per month in interest if you do not pay it back right away. Over six months, you pay about $80 total in fees and interest — a 16% cost on top of the original $500.

A personal loan from a bank or credit union, or a line of credit, usually costs less. Personal loans typically charge 6% to 36% APR depending on your credit, with no upfront fee. A $500 personal loan at 18% APR costs you roughly $45 in interest over six months — less than half what the cash advance costs.

Even a payday loan, which has a bad reputation, sometimes costs less than a credit card cash advance if you pay it back quickly. A $500 payday loan typically costs $50 to $100 in fees, but you pay it back in two weeks, not six months.

The only time a cash advance makes sense is if you need cash urgently, have no other option, and can pay it back within a few weeks. If you need the money for longer than that, look for a personal loan or line of credit first.

How cash advances affect your credit score

A cash advance does not hurt your credit score directly — it is not reported to the credit bureaus as a separate transaction. However, it does increase your credit card balance, which raises your credit utilization ratio (the percentage of your available credit you are using). If your utilization goes above 30%, your score may drop slightly.

The bigger risk is if you cannot pay back the cash advance and it sits on your card for months. Missed payments and high balances both damage your score. If you take out a cash advance, make a plan to pay it back quickly so you do not end up carrying a high balance.

Frequently Asked Questions

Can I use a credit card to withdraw cash from a bank teller without a PIN?

Yes. Go to any bank branch (not just your card issuer's bank), bring your card and photo ID, and ask the teller for a cash advance. You do not need a PIN for this method, though you still pay the cash advance fee and interest.

What is the difference between a cash advance and a balance transfer?

A cash advance gives you physical cash and charges a high fee and interest rate immediately. A balance transfer moves debt from one card to another, usually with a lower 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. Your cash advance limit is part of your total credit limit. If you have used your entire credit limit, you cannot withdraw any more cash or make any more purchases until you pay down the balance.

Does paying back a cash advance faster lower the interest I owe?

Yes. Interest accrues daily, so the sooner you pay it back, the less interest you owe. If you can pay back the full amount within a few days, you will owe only a few dollars in interest plus the upfront fee. The longer you carry the balance, the more interest adds up.

What happens if I do not pay back the cash advance?

It becomes part of your credit card balance and you owe interest on it indefinitely. If you miss payments, your card issuer may report it to the credit bureaus, which damages your credit score. They may also charge late fees and increase your interest rate.