Yes, you can take money out of a credit card, but it costs more than a regular purchase
A cash advance is a withdrawal of cash from your credit card account. You can get one at an ATM, a bank teller window, or sometimes through a convenience store or casino. The money comes from your credit line, not a separate account, so you owe it back to your card issuer just like a purchase.
The catch is that cash advances charge higher fees and interest rates than regular card purchases. Most cards charge a flat fee (often $5 to $10) or a percentage of the amount (usually 3 to 5%), whichever is larger. Interest starts accruing immediately — there is no grace period like there is for purchases — so even if you pay it back within days, you will owe interest.
Because of these costs, a cash advance should be a last resort, not a convenient way to get spending money. If you need cash regularly, a debit card or ATM withdrawal from a bank account is much cheaper.
Key Takeaways
- Cash advances charge a fee (usually 3 to 5% of the amount) plus interest that starts immediately, making them expensive compared to regular purchases.
- You can withdraw cash at ATMs, bank branches, or some retail locations, but your card issuer sets a separate cash advance limit that may be lower than your credit limit.
- Interest on a cash advance accrues from day one with no grace period, so the longer you carry the balance, the more you pay.
- Some cards offer 0% introductory rates on purchases but never on cash advances, so this is one of the most costly ways to use a credit card.
Where you can withdraw cash from a credit card
ATMs are the most common place to get a cash advance. Insert your card, enter your PIN, and select "cash advance" or "withdrawal" — the ATM will tell you the fee before you confirm. You can use ATMs from any bank or network, though out-of-network ATMs may charge an additional fee on top of your card issuer's fee.
Bank tellers can also process a cash advance if you visit a branch in person. This is sometimes useful if you need a large amount or if you want to ask questions about the fee before you proceed. Some credit unions and smaller banks may refuse cash advances altogether, so call ahead if you are not sure.
Convenience stores, casinos, and some other retailers offer cash advances at the register, though these locations usually charge higher fees than ATMs. Avoid these unless you have no other option — the total cost can be steep.
Cash advance limits and how they work
Your card issuer sets a cash advance limit separate from your regular credit limit. This limit is often much lower — sometimes 20 to 50% of your credit limit — and you cannot increase it just by paying down your balance. If you want a higher cash advance limit, you have to contact your card issuer and request one, though they may decline.
When you take a cash advance, it counts against both your cash advance limit and your overall credit limit. So if your credit limit is $5,000 and your cash advance limit is $1,000, you can withdraw up to $1,000 in cash, but that $1,000 also reduces the $5,000 available for regular purchases.
The amount you withdraw appears on your statement as a separate line item from purchases. Your card issuer will show the fee, the interest rate (which is usually higher than your purchase rate), and the balance owed.
Fees and interest rates for cash advances
Cash advance fees vary by card but typically fall into two categories: a flat fee per transaction or a percentage of the amount withdrawn. A flat fee might be $5 to $10 regardless of how much you take out. A percentage fee is usually 3 to 5% of the withdrawal amount. Your card issuer charges whichever is larger.
The interest rate on a cash advance is almost always higher than the rate on purchases. While a purchase might carry an APR of 15%, a cash advance on the same card might be 20% or higher. This rate applies from the moment you withdraw the cash — there is no grace period. If you withdraw $500 and pay it back in full within a week, you still owe interest for that week.
Because interest accrues daily, the longer you carry a cash advance balance, the more you pay. A $500 cash advance at 20% APR costs roughly $2.74 per day in interest alone, before the transaction fee.
How cash advances affect your credit score
A cash advance does not directly hurt your credit score the way a missed payment does. However, it can harm your score indirectly by raising your credit utilization ratio — the percentage of your available credit that you are using. If you have a $5,000 credit limit and you take a $1,000 cash advance, your utilization jumps to 20%, which credit scoring models view as riskier.
The impact is usually small if you pay off the cash advance quickly. But if you carry the balance for months, the high utilization can lower your score by 10 to 50 points depending on your overall credit profile. Once you pay it off, your utilization drops and your score should recover.
A cash advance also does not build credit the way a regular purchase does. Both show up on your credit report, but lenders do not view a cash advance as evidence that you can manage credit responsibly — it looks more like a sign of financial strain.
Alternatives to cash advances
If you need cash urgently, explore these options before taking a cash advance. A personal loan from a bank or credit union usually charges lower interest than a cash advance and gives you a fixed repayment schedule. A payday loan is faster to get but often charges even higher fees, so compare the total cost carefully.
If you have a debit card linked to a checking account, withdraw cash from an ATM for free or a small fee (usually $0 to $3 for out-of-network use). If you do not have a bank account, a prepaid card or a check-cashing service costs less than a cash advance in most cases.
Borrowing from family or friends, if possible, costs nothing and avoids debt entirely. If you are in a genuine emergency, some nonprofits and community organizations offer emergency cash assistance or loans at low or no interest.
What happens if you cannot pay back a cash advance
If you do not pay a cash advance, it works like any other credit card debt. The balance accrues interest, and if you miss the minimum payment, your card issuer reports it to the credit bureaus after 30 days. Your credit score drops, and the issuer may raise your interest rate or lower your credit limit.
After 180 days of nonpayment, the card issuer usually closes the account and sells the debt to a collection agency. The collection agency can then contact you to demand payment, and if you still do not pay, they may sue. A judgment against you can lead to wage garnishment or a bank account levy, depending on your state's laws.
If you are struggling to pay back a cash advance, contact your card issuer as soon as possible. Some issuers offer hardship programs that lower your interest rate or waive fees if you are facing financial difficulty. This is not a may provide, but it is worth asking before the debt spirals.
Frequently Asked Questions
Can I use a credit card cash advance to pay another credit card bill?
Technically yes, but it is a bad idea. You would pay a cash advance fee on the withdrawal, then pay interest on the balance immediately. You would end up paying more in fees and interest than if you just paid the other card with money from your bank account or income. This strategy only makes sense if you are trying to buy time before a payment is due, and even then, the cost is steep.
Do all credit cards offer cash advances?
Most do, but not all. Some cards marketed for people rebuilding credit or secured cards do not include cash advance features. Check your card's terms or call your issuer to confirm whether cash advances are available on your account.
Is there a limit to how much I can withdraw in one day?
Yes. Your card issuer sets a daily cash advance limit, which is separate from your overall cash advance limit. This limit might be $500, $1,000, or another amount depending on your card and account history. You can ask your issuer what your daily limit is, and you may be able to request a temporary increase for a specific withdrawal.
Will a cash advance show up on my credit report?
The cash advance itself does not appear as a separate line item on your credit report. However, the balance counts toward your overall credit card balance, which does show up. If you carry a high cash advance balance for months, it raises your utilization ratio and can lower your credit score.
What is the difference between a cash advance and a balance transfer?
A cash advance gives you physical cash and charges a fee plus interest from day one. A balance transfer moves debt from one card to another and may offer a 0% introductory rate for a set period. Balance transfers are usually cheaper if you are moving existing debt, but they do not give you cash in hand.