Yes, you can get cash from a credit card, but it costs more than a regular purchase

A cash advance lets you withdraw money from your credit card at an ATM, bank, or through a teller. The cash goes into your pocket or account when ready. But unlike a regular purchase, a cash advance charges you interest right away — there is no grace period — and usually costs a flat fee or a percentage of the amount you withdraw, whichever is higher.

Most people use cash advances only when they have no other option, because the cost adds up fast. If you need cash regularly, a debit card or a trip to your bank is almost always cheaper.

Key Takeaways

  • Cash advances charge interest from the day you withdraw the money, with no grace period like a regular purchase has.
  • You pay both a cash advance fee (usually 3 to 5 percent of the amount) and a higher interest rate than you pay on purchases.
  • You can get a cash advance at an ATM using your PIN, at a bank teller, or through a convenience store or casino that offers cash back.
  • The total cost of a cash advance can be 5 to 10 percent or more depending on the amount and how long you carry the balance.

How to withdraw cash from your credit card

The most common way is to use an ATM. Insert your credit card, enter your PIN (which you set up when you opened the card or requested one from your issuer), and select "cash advance" or "withdraw cash." The ATM will show you the fee before you confirm. You can usually withdraw up to a limit set by your card issuer — often $500 to $1,000 per day, though this varies.

You can also go to a bank teller and ask for a cash advance. Bring your credit card and ID. The teller will process it the same way an ATM does, and you will pay the same fee. Some convenience stores and casinos offer cash advances too, though the fees are often higher than at an ATM.

A third option is a balance transfer check. Your card issuer mails you a check that draws against your credit line. You deposit it like any other check. This counts as a cash advance and carries the same fees and interest, but it lets you move money to your bank account without visiting an ATM.

What fees and interest you will pay

Every cash advance costs you two things: a fee and interest.

The cash advance fee is charged once, when you withdraw. It is usually 3 to 5 percent of the amount you take out, with a minimum fee (often $5 to $10). So if you withdraw $200 and your card charges 4 percent, you pay $8. If you withdraw $100 and the minimum is $5, you pay $5.

The interest rate on a cash advance is higher than the rate on purchases. Where a purchase might carry 18 percent APR, a cash advance might be 24 or 28 percent. Interest starts accruing the day you withdraw — there is no 21-day grace period like there is for purchases. If you carry a $500 cash advance for a month at 25 percent APR, you pay roughly $10 in interest alone, on top of the upfront fee.

The total cost depends on how long you carry the balance. A $500 advance at 4 percent fee plus 25 percent APR costs $20 upfront, then $10 per month in interest if you do not pay it down.

When a cash advance makes sense

A cash advance is worth considering only in specific situations. If you need cash for an emergency and have no other way to get it, a cash advance is faster than a personal loan. If you are traveling and your bank has no ATMs nearby, it may be your only option.

But if you have a debit card, a bank account you can draw from, or a friend who can lend you money, those are cheaper. Even a payday loan or credit union loan usually costs less than a cash advance when you add up the fee and interest.

Do not use a cash advance to pay off other debts or to fund regular expenses. The interest rate is too high, and you will end up paying more than if you had borrowed another way.

How a cash advance affects your credit score

A cash advance does not hurt your credit score directly. The withdrawal itself does not show up on your credit report. But it does increase your credit card balance, which raises your credit utilization ratio — the percentage of your available credit you are using. If you normally use 20 percent of your limit and you take a $500 cash advance, your utilization might jump to 40 or 50 percent. A high utilization ratio can lower your score by a few points.

The bigger risk is missing a payment. If you cannot pay back the cash advance quickly, the balance will grow with interest, and a missed payment will damage your score much more than the utilization did.

Paying back a cash advance

A cash advance is treated like any other credit card balance. You make a monthly payment, and interest accrues on whatever you do not pay off. Your credit card statement will show the cash advance separately from purchases, and some cards explore your payment to purchases first, then to the cash advance.

To avoid interest, pay off the cash advance as soon as you can. Unlike a purchase, there is no grace period, so every day you carry the balance costs you money. If you took a $500 advance and can pay it back within a week, do it — the interest will be minimal. If you need to carry it for months, the total cost will be substantial.

Check your statement to see how your card issuer applies payments. If they pay down purchases before cash advances, and you have both on your card, you may want to pay the cash advance balance in full before making other charges.

Alternatives to a cash advance

Before you use a cash advance, consider these options:

  • Debit card withdrawal: If you have a debit card linked to a bank account, use it instead. There is no fee and no interest.
  • Bank transfer: Many banks let you transfer money from savings to checking for free, or withdraw cash at a teller window.
  • Credit union loan: If you belong to a credit union, they often offer small personal loans at lower rates than a cash advance.
  • Paycheck advance: Some employers or payroll services offer advances on your next paycheck, sometimes for free or a small flat fee.
  • Personal loan: A bank or online lender may offer a personal loan at a lower rate than a cash advance, especially if you have good credit.

Frequently Asked Questions

What is the difference between a cash advance and a regular purchase?

A purchase has a grace period — usually 21 days — where you pay no interest if you pay the full balance by the due date. A cash advance charges interest from day one, with no grace period. A cash advance also costs an upfront fee, while purchases do not.

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

Technically yes, but it is expensive. You pay the cash advance fee and interest rate on the money you withdraw, then you still owe the other card. You end up paying two interest rates on the same debt. A balance transfer (moving the balance from one card to another) is usually cheaper if your new card offers a 0 percent introductory rate.

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

Interest keeps accruing, and your balance grows. If you miss a payment, your card issuer will charge a late fee and report the missed payment to the credit bureaus, which will lower your credit score. After several months of missed payments, the card issuer may close your account and send the debt to a collection agency.

Is there a limit to how much I can withdraw?

Yes. Your card issuer sets a cash advance limit, which is often lower than your total credit limit. It might be $500, $1,000, or higher depending on your card and credit history. You can call your card issuer to ask what your limit is, or check your online account.

Do I need a PIN to get a cash advance?

You need a PIN to use an ATM. If you do not have one, contact your card issuer and request one — it usually arrives in the mail within a week. At a bank teller or with a balance transfer check, you do not need a PIN, just your card and ID.