Yes, you can take money directly out of a credit card, but it works differently than a debit card withdrawal

When you take cash out of a credit card, you are borrowing money against your credit limit the same way you would by making a purchase. The difference is that instead of paying a merchant, you are getting physical cash. This is called a cash advance.

The catch: a cash advance costs more than a regular purchase. You pay an upfront fee (usually 3 to 5 percent of the amount you withdraw), and the interest rate on that cash starts accruing immediately—there is no grace period like there is for purchases. If you owe $200 in cash advances and $200 in purchases, the cash advance interest compounds while you are still in the grace period on the purchase.

Most people use cash advances only when they have no other option, because the cost adds up quickly. But the mechanics are straightforward: you walk into a bank or ATM, insert your credit card, and withdraw cash just like you would from a checking account.

Key Takeaways

  • You can withdraw cash from an ATM or bank teller using your credit card, but the transaction is treated as a loan against your credit limit, not a withdrawal from your own money.
  • Cash advances charge an upfront fee (typically 3 to 5 percent) plus a higher interest rate than purchases, and interest begins accruing immediately with no grace period.
  • Your credit card issuer sets a cash advance limit, which may be lower than your overall credit limit and varies by card and by your creditworthiness.
  • The total cost of a cash advance can exceed the cost of other borrowing options, so it is worth comparing alternatives like personal loans or asking a friend before using this feature.

Where you can withdraw cash from a credit card

You have two main routes: an ATM or a bank teller. At an ATM, insert your credit card and enter your PIN (the same one you would use for a debit card, or one your issuer assigned when you opened the account). Select "cash advance" or "withdraw cash"—the exact wording varies by machine. The ATM will show you the fee before you confirm, so you can see the cost upfront.

At a bank teller, you can ask to withdraw cash against your credit card. You will need to show ID. The teller will process it the same way an ATM does, and you will see the fee on your receipt. Some banks charge an additional fee for teller-processed cash advances on top of the card issuer's fee, so ask before you proceed.

Not every ATM accepts credit cards for cash advances. Bank-owned ATMs in the issuer's network usually do. ATMs run by third parties (in convenience stores, bars, or independent networks) may decline the transaction. If the ATM rejects your card, try a different machine or go to a bank branch instead.

The fees and interest you will pay

A cash advance typically costs you three things: an upfront fee, a higher interest rate, and interest that starts immediately. The upfront fee is usually 3 to 5 percent of the amount you withdraw, charged to your account right away. So if you withdraw $500, you might pay $15 to $25 just to get the cash.

The interest rate on cash advances is almost always higher than the rate on purchases. Where a purchase might carry an APR (annual percentage rate) of 18 percent, a cash advance might be 25 percent or higher. That rate varies by card and by your credit history, so check your cardholder agreement or call your issuer to find out what you will pay.

The critical difference from purchases: interest on a cash advance starts accruing the day you withdraw it. There is no grace period. If you withdraw $500 on January 1 and pay it back on January 15, you still owe interest for those 15 days. With a purchase, you typically have 21 to 25 days before interest kicks in.

The math adds up fast. A $500 cash advance at a 5 percent fee ($25) plus 25 percent APR costs you $25 upfront, then roughly $10 in interest if you pay it back in a month. That is $35 total, or 7 percent of the money you borrowed.

Your cash advance limit is separate from your credit limit

Your credit card issuer sets a cash advance limit that is often lower than your overall credit limit. If your credit limit is $5,000, your cash advance limit might be $1,500 or $2,000. This limit is set by the issuer based on your creditworthiness and payment history, and it can change over time.

You can find your cash advance limit in your cardholder agreement, on your online account dashboard, or by calling the customer service number on the back of your card. If you try to withdraw more than your limit, the ATM or teller will decline the transaction.

The cash you withdraw counts against both your cash advance limit and your overall credit limit. So if you withdraw $500 and your credit limit is $5,000, you now have $4,500 available for purchases and other cash advances combined.

Why cash advances are usually a last resort

The fees and interest make cash advances expensive compared to other ways of borrowing. A personal loan from a bank or credit union typically charges 6 to 36 percent APR with no upfront fee. A payday loan (which is predatory and should be avoided) charges more than a cash advance but is sometimes cheaper if you pay it back within two weeks. Even a cash advance from a different card with a lower rate might cost less.

Before you use a cash advance, consider whether you can borrow from a friend or family member, delay the purchase, or use a different payment method. If you do need cash and have no other option, a cash advance is faster than a personal loan application, but the cost is real.

If you find yourself regularly needing cash advances, that is a sign your budget may need attention. Repeated cash advances can damage your credit score because they increase your credit utilization (the percentage of your limit you are using), and they can trap you in a cycle of debt if you cannot pay them back quickly.

How to minimize the cost if you do take a cash advance

If you have decided a cash advance is necessary, you can reduce the damage. First, withdraw only what you need. The fee is a percentage, so a $100 withdrawal costs less than a $500 one. Second, pay it back as fast as you can. Because interest accrues immediately, every day you carry the balance costs you money. If you can pay the full amount back within a week, do it.

Third, check whether your issuer offers a lower cash advance rate for certain cards or account types. Some cards marketed to people with good credit have lower cash advance rates than others. If you have multiple cards, compare their rates before you withdraw.

Finally, do not use a cash advance to pay another debt unless you are certain the new debt is cheaper. For example, using a cash advance to pay off a payday loan might make sense if the cash advance rate is lower. But using a cash advance to pay a credit card bill is almost never worth it—you are just moving the debt and paying fees in the process.

Frequently Asked Questions

Can I use a credit card to withdraw cash from any ATM?

Most ATMs accept credit cards, but some decline them. Bank-owned ATMs in your card issuer's network are most reliable. Third-party ATMs in stores or independent networks may reject credit card cash advances. If one machine declines your card, try another ATM or visit a bank branch instead.

What happens if I cannot pay back a cash advance?

The balance stays on your credit card and accrues interest at the higher cash advance rate. If you do not pay the minimum, your credit score drops and late fees apply. The debt can grow quickly because of the high interest rate, so contact your issuer as soon as you know you will struggle to pay.

Is a cash advance the same as a balance transfer?

No. A cash advance gives you physical cash and charges a fee plus high interest. A balance transfer moves debt from one card to another, usually with a lower introductory rate. Balance transfers are for moving existing debt; cash advances are for getting cash. Both count against your credit limit.

Will a cash advance hurt my credit score?

It can. A cash advance increases your credit utilization (the percentage of your limit you are using), which can lower your score temporarily. If you miss payments on the cash advance, the damage is more serious. Paying the balance off quickly minimizes the impact.

Can I take a cash advance from a credit card I just opened?

Usually yes, but your cash advance limit may be very low when the account is new. Call your issuer to find out what your limit is. Some issuers set the cash advance limit at zero initially and raise it after you have used the card responsibly for a few months.