Yes, you can withdraw cash using a credit card, but it costs more than a regular purchase

You can get cash from your credit card at an ATM, bank teller, or by asking a cashier for cash back at a store. The transaction is called a cash advance. Unlike a debit card withdrawal, a cash advance charges you interest immediately — there is no grace period — and usually costs an upfront fee as well. The total cost can be 5 to 10 percent of the amount you withdraw, depending on your card and your bank.

Most people use cash advances only when they have no other option, because the fees and interest add up fast. If you need cash regularly, a debit card or a trip to your bank is cheaper. But if you are in a situation where you need cash right now and have no other way to get it, knowing how a cash advance works can help you decide whether it makes sense.

Key Takeaways

  • Cash advances charge interest from the day you withdraw the money, with no grace period like you get on purchases.
  • Most credit cards charge a cash advance fee of 3 to 5 percent of the amount withdrawn, on top of interest charges.
  • You can withdraw cash at an ATM using your credit card PIN, at a bank teller with your card and ID, or by asking for cash back at a store checkout.
  • The interest rate on cash advances is usually higher than the rate on regular purchases, and varies by card and issuer.

Where you can actually withdraw cash with a credit card

An ATM is the fastest way. Insert your credit card, enter your PIN, and select the cash advance option. The machine will dispense cash and charge your credit card account immediately. You can use ATMs from your card issuer's network (usually free) or out-of-network ATMs (which charge an additional ATM operator fee on top of your card's cash advance fee).

A bank teller can also process a cash advance. Walk into any branch of your card issuer's bank with your credit card and a photo ID, tell the teller you want a cash advance, and they will process it at the counter. This method is slower than an ATM but works if you do not have a PIN or the ATM is not working.

Some stores offer cash back at checkout. Ask the cashier if they can give you cash back on your credit card. Not all retailers accept this, and those that do usually have a limit — often $20 to $100 per transaction. This is convenient if you are already making a purchase, but it still counts as a cash advance and carries the same fees and interest.

The fees and interest you will pay

A cash advance fee is charged the moment you withdraw the money. Most credit cards charge between 3 and 5 percent of the amount withdrawn, with a minimum fee of $2 to $10. So if you withdraw $200, you might pay $6 to $10 in fees alone. Some cards charge a flat fee instead of a percentage — check your card's terms to know which applies to you.

Interest starts accruing immediately — there is no 21-day grace period like you get on regular purchases. The interest rate on cash advances is usually 2 to 5 percentage points higher than your regular purchase APR. If your purchase rate is 18 percent, your cash advance rate might be 23 percent. Interest compounds daily, so the longer you carry the balance, the more you owe.

Here is a concrete example: You withdraw $300 in cash. Your card charges a 4 percent cash advance fee ($12) and a 22 percent APR. After one month, you owe roughly $305.50 in interest alone, plus the original $300 and the $12 fee — a total of $617.50. If you pay it back within a week, you owe closer to $312, which is still expensive for a short-term loan.

How cash advances affect your credit score

A cash advance itself does not directly hurt your credit score, but it can indirectly. The withdrawal increases your credit card balance, which raises your credit utilization ratio — the percentage of your available credit you are using. If you normally use 30 percent of your limit and a $300 cash advance pushes you to 50 percent, that higher ratio can lower your score by a few points.

The damage is temporary. Once you pay off the cash advance, your utilization drops and your score recovers. But if you carry the balance for months, the high utilization keeps dragging your score down. Missing a payment on a cash advance is treated the same as missing any other credit card payment — it will damage your score significantly and stay on your report for seven years.

When a cash advance actually 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 — no savings, no access to a bank, no friends or family who can lend you money — then a cash advance is better than missing a bill or going without. The fees hurt, but they hurt less than a late payment or overdraft fee.

A cash advance also makes sense if you are traveling internationally and your debit card does not work. Some travelers use a credit card cash advance at a foreign ATM rather than exchange cash at a hotel desk, which charges much higher fees. In that case, the credit card advance might be the cheaper option.

A cash advance does not make sense for everyday cash needs, to pay off other debts, or to fund a purchase you cannot afford. If you find yourself regularly needing cash advances, that is a sign your budget is stretched too thin or you are spending more than you earn. The real fix is to cut expenses or increase income, not to borrow at 20+ percent interest.

Alternatives that cost less

If you need cash and have time to plan, a balance transfer to a 0 percent promotional card can be cheaper than a cash advance on your current card — but balance transfers usually do not work for cash, only for moving debt between cards. A personal loan from a bank or credit union typically charges 6 to 15 percent interest, which is lower than a cash advance rate. If you have time to borrow, a personal loan is usually the better choice.

A payday loan is another option, though it is often more expensive than a cash advance. Payday lenders charge fees of $15 to $20 per $100 borrowed, which works out to 400+ percent APR on a two-week loan. A cash advance at 22 percent APR is actually cheaper than a payday loan, but both are expensive ways to borrow.

The cheapest option is always to avoid borrowing altogether. If you can wait a few days, transfer money from savings, ask your employer for an advance on your paycheck, or borrow from a friend or family member at no interest. If you have no savings and no one to borrow from, that is the real problem to solve — building an emergency fund of $500 to $1,000 so you never have to use a cash advance again.

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

If you decide a cash advance is your best option, pay it back as fast as you can. Every day you carry the balance, interest compounds. Paying back $300 in one week costs far less than paying it back in one month. If possible, make a payment before the statement closes so the interest does not get added to your next bill.

Use an ATM in your card issuer's network to avoid the extra ATM operator fee. If your card issuer is a national bank, their ATMs are usually free. If you use an out-of-network ATM, you might pay $2 to $3 on top of your card's cash advance fee — that adds up fast on small withdrawals.

Check your card's terms before you withdraw. Some cards have a lower cash advance limit than your overall credit limit, or a maximum amount you can withdraw per day. Knowing these limits ahead of time prevents surprises and helps you plan the withdrawal.

Frequently Asked Questions

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

You can use most ATMs, but you will pay extra fees if the ATM is not part of your card issuer's network. ATMs from your issuer are usually free, but out-of-network ATMs charge an operator fee of $2 to $3 on top of your card's cash advance fee. Always look for your bank's ATM first.

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

A regular purchase has a grace period — usually 21 days — before interest starts. A cash advance charges interest from day one. Cash advances also charge an upfront fee (3 to 5 percent) and usually have a higher interest rate than purchases. For these reasons, a cash advance is much more expensive.

Does a cash advance hurt my credit score?

A cash advance does not directly hurt your score, but it increases your credit utilization ratio, which can lower your score by a few points. The damage is temporary and goes away once you pay it off. Missing a payment on a cash advance, however, will seriously damage your score.

Can I get a cash advance if my credit card is maxed out?

No. A cash advance counts against your available credit, so you can only withdraw up to your remaining credit limit. If your card is maxed out, you cannot take a cash advance. Some cards also set a separate cash advance limit that is lower than your overall limit.

How long does a cash advance take to show up on my statement?

The withdrawal is immediate — you get the cash right away. The charge appears on your account within one to two business days. Interest starts accruing from the day you withdraw, even if the charge has not posted yet.