You can pay for a money order with a credit card at most retailers, but your card issuer may treat it as a cash advance

Most places that sell money orders — including Walmart, CVS, Western Union, and your bank — will accept a credit card as payment. However, the transaction often gets classified as a cash advance rather than a regular purchase. This matters because cash advances typically carry higher fees and interest rates than standard credit card charges, and interest starts accruing immediately instead of after a grace period.

Some card issuers and some retailers have different rules. A few banks will process money order purchases as regular transactions. Some retailers may decline credit cards for money orders altogether. The only way to know for certain is to ask the retailer or call your card issuer before you buy.

Key Takeaways

  • Money order purchases made with a credit card are often classified as cash advances, which charge higher fees and interest rates than regular purchases.
  • Interest on cash advances begins immediately and is not subject to a grace period, even if your card normally offers one.
  • Walmart, banks, and Western Union locations typically accept credit cards for money orders, but the transaction type depends on your specific card issuer.
  • Debit cards, bank account transfers, and cash are usually cheaper ways to pay for a money order than using a credit card.

Why money order purchases may be treated as cash advances

A cash advance is when you use your credit card to get cash or cash-like funds. Money orders fall into this category because they function like cash — they can be spent anywhere and by anyone who holds them. Your card issuer sees the transaction the same way it sees withdrawing cash from an ATM.

Cash advances trigger different fees and rates because they carry more risk for the card issuer. You are not buying a product or service; you are converting credit into a form of value that can be transferred. The issuer charges a cash advance fee (often 3 to 5 percent of the amount, with a minimum fee of $5 to $10) and applies a higher interest rate, sometimes several percentage points above your regular APR.

The interest clock starts the moment you complete the transaction. Unlike a purchase, which may have a 21-day grace period before interest accrues, cash advance interest begins right away. If you carry a balance, you will pay interest on the money order cost every single day until it is paid off.

Which retailers accept credit cards for money orders

Most major retailers and financial institutions that sell money orders will take a credit card, but policies vary by location and by card issuer. Walmart, CVS, Walgreens, Western Union, MoneyGram, and most banks and credit unions accept credit cards at the point of sale. However, some locations may have restrictions, and some card issuers may decline the transaction.

The safest approach is to call ahead or ask at the counter before you attempt to buy. Tell the retailer you want to pay with a credit card and ask whether they will process it as a regular purchase or a cash advance. Then call your card issuer's customer service number (on the back of your card) and ask the same question — whether they classify money order purchases as cash advances or regular transactions.

If your card issuer declines the transaction or classifies it as a cash advance, you have other payment options. Most retailers that sell money orders also accept debit cards, bank transfers, and cash.

Fees and interest you may pay

The total cost of paying for a money order with a credit card includes three separate charges: the money order fee itself, the cash advance fee from your card issuer, and the interest that accrues on the balance.

A money order typically costs $1 to $10 depending on the amount and the retailer. A cash advance fee is usually 3 to 5 percent of the amount you are advancing, with a minimum of $5 to $10. So if you buy a $500 money order, you might pay $5 to $10 for the money order itself, plus $15 to $25 in cash advance fees, plus daily interest on the $500 balance until you pay it off.

If your card has a 20 percent APR and you carry the $500 balance for 30 days, you will pay roughly $8 in interest. The total cost of that $500 money order could reach $48 to $53 — nearly 10 percent of the amount itself. By contrast, paying with cash or a debit card costs only the money order fee, typically $1 to $10.

Cheaper ways to pay for a money order

If your credit card issuer treats money order purchases as cash advances, or if you want to avoid the extra fees, several alternatives cost less or nothing.

Debit cards are processed as regular transactions, not cash advances, and do not trigger cash advance fees or interest. If you have a debit card linked to your bank account, use it instead of a credit card. Bank transfers or ACH payments are often free or very cheap and may be an option if the person you are paying accepts them. Cash costs nothing beyond the money order fee itself. If you do not have cash on hand, withdrawing it from an ATM costs less than a credit card cash advance — most ATM fees are $2 to $3, compared to 3 to 5 percent cash advance fees.

If you must use a credit card, ask your card issuer whether they offer any cards with lower cash advance fees or rates. Some cards marketed toward people with limited credit history have cash advance rates closer to their regular APR, though these are uncommon.

What happens if you cannot pay the balance right away

If you charge a money order to your credit card and cannot pay off the balance immediately, the interest will compound daily. Unlike a regular purchase, which may have a grace period, cash advance interest starts accruing on day one.

If you carry the balance for several months, the interest and fees can easily exceed the cost of the money order itself. For example, a $200 money order purchased with a credit card at 20 percent APR could cost an additional $40 to $50 in interest and fees over three months if you only make minimum payments.

If you are considering using a credit card for a money order, plan to pay off the charge as soon as possible — ideally within the same billing cycle. If you cannot pay it off quickly, use a debit card, cash, or a bank transfer instead.

Frequently Asked Questions

Will my credit card issuer always treat a money order as a cash advance?

Not always. Some card issuers process money order purchases as regular transactions, especially if you buy them at a bank or credit union. Others classify them as cash advances. The only way to know is to contact your card issuer directly and ask. They can tell you how your specific card handles money order transactions.

Can I use a credit card to buy a money order online?

Some online money order services accept credit cards, but they typically charge higher fees than in-person retailers. Online services like MoneyGram and Western Union allow credit card payments, but you may pay 5 to 10 percent in fees on top of the money order cost. Buying in person at a retailer is usually cheaper.

What if the retailer or my card issuer declines the transaction?

If your card is declined, ask the retailer what payment methods they accept. Most places that sell money orders also take debit cards, cash, and sometimes bank transfers. If you do not have another payment method available, you may need to return with cash or a debit card.

Does paying for a money order with a credit card affect my credit score?

A single money order purchase will not harm your score. However, if you carry a high balance on your card because of the purchase, it increases your credit utilization ratio, which can lower your score slightly. Paying off the balance quickly minimizes this effect.