Yes, you can get cash back on a credit card, but it costs you money
When you use a credit card to withdraw cash from an ATM or ask a cashier for cash back at checkout, you are borrowing money from your credit card company — not accessing your own funds. The card issuer charges you a cash advance fee, usually 3% to 5% of the amount you withdraw, and the interest rate on that cash starts accruing when ready, often at a higher rate than your regular purchase APR. This makes cash advances one of the most expensive ways to get money from a credit card.
The mechanics are straightforward: you insert your card into an ATM, enter your PIN, and withdraw cash up to your card's cash advance limit (which is often lower than your credit limit). At a store, you ask the cashier for cash back, and they hand you bills while charging the amount to your card. But the cost structure is what matters. Unlike a purchase, which has a grace period before interest kicks in, cash advance interest begins the moment you withdraw the money.
Key Takeaways
- Cash advances charge a fee (usually 3% to 5%) plus a higher interest rate than regular purchases, starting when ready with no grace period.
- Your cash advance limit is often much lower than your credit limit, so you may not be able to withdraw as much as you think.
- ATM withdrawals and store cash back both count as cash advances and trigger the same fees and rates.
- If you need cash, a debit card, bank withdrawal, or personal loan will almost always cost you less than a credit card cash advance.
How much the fees and interest actually cost
A $200 cash advance with a 4% fee costs you $8 when ready. If your cash advance APR is 24% (common for many cards), you owe roughly $4 in interest after one month if you pay nothing else. Pay it back in full within a week, and you still owe the $8 fee plus a few dollars in interest — so roughly $10 to $12 out of pocket for borrowing $200.
Compare that to using a debit card to withdraw the same $200 from your own bank account, which costs nothing, or taking out a small personal loan at 12% APR, which would cost you roughly $2 in interest over a month. The credit card cash advance is the most expensive option by a wide margin.
Your card issuer sets both the fee and the APR, and they vary by card and by issuer. Check your card's terms or call the number on the back to find out your specific cash advance fee and APR before you withdraw.
What your cash advance limit means
Your cash advance limit is separate from your credit limit. If you have a $5,000 credit limit, your cash advance limit might be $1,000 or $1,500 — often 20% to 50% of your total credit limit. This means you cannot withdraw $5,000 in cash even if you have room on your card.
The limit exists because credit card companies see cash advances as riskier than purchases. When you buy something with a credit card, the merchant guarantees the transaction and you have dispute rights. When you withdraw cash, there is no merchant, no receipt to dispute, and no way for the issuer to recover the money if you do not pay.
You can call your card issuer to ask what your cash advance limit is, or check your online account. Some cards let you request a higher limit, but many do not.
Where you can withdraw cash from a credit card
You have two main options: ATMs and store checkout. At an ATM, insert your card, enter your PIN, and select the cash withdrawal option. Most ATMs accept credit cards, though some are limited to debit cards only — the machine will tell you if your card does not work. At a store, tell the cashier you want cash back after your purchase, and they will add the amount to your total bill.
Both methods trigger the same cash advance fee and interest rate. Neither one is cheaper than the other. The only difference is convenience: an ATM works anytime, but store cash back only works if you are already buying something.
Some credit card companies charge an additional ATM operator fee on top of their own cash advance fee. This can add another $2 to $3 per withdrawal. Check your card's terms to see whether your issuer charges this extra fee.
When a cash advance might make sense
Cash advances are rarely the right choice, but there are narrow situations where they might be the least bad option. If you have an emergency and need cash when ready, and you cannot access your debit card, cannot reach your bank, and cannot borrow from a friend or family member, a small cash advance might be faster than waiting for a personal loan to process.
Even then, the math usually does not work in your favor. A $100 cash advance costs you $3 to $5 in fees plus interest. A payday loan, which is also expensive, might cost you $15 to $20 for the same $100 — but at least you know the total cost upfront and the loan period is short. A personal loan from a bank or credit union, if you can get one, will cost you far less over time.
The honest answer: if you are considering a cash advance, explore other options first. Borrow from someone you trust, use your debit card, visit your bank branch, or wait a day or two for a personal loan. Any of those will cost you less.
How a cash advance affects your credit score
A cash advance does not directly hurt your credit score the way a missed payment does. However, it does increase your credit utilization — the percentage of your available credit you are using. If you have a $5,000 credit limit and a $1,000 cash advance limit, and you withdraw $500, your utilization jumps by 10% of your total credit limit. High utilization can lower your score by a few points.
The bigger risk is that a cash advance makes it easier to fall behind on payments. Because interest starts when ready and the APR is high, the balance grows quickly if you cannot pay it back right away. A missed payment on that balance will damage your score far more than the utilization did.
Better alternatives to a credit card cash advance
If you need cash, consider these options in order of cost:
- Use your debit card or visit your bank. Withdraw from your own account for free. This is always the cheapest option if you have the money available.
- Ask for a personal loan from a bank or credit union. Rates vary, but credit unions often offer rates between 6% and 18% APR, much lower than a cash advance. The process takes a few days but costs far less if you need to carry a balance.
- Borrow from a friend or family member. If possible, this costs nothing and keeps money within your circle.
- Use a balance transfer card. If you have time to plan, some cards offer 0% APR on balance transfers for 6 to 21 months. This does not help you get cash, but it can help you move existing debt to a cheaper card.
- Ask your employer for an advance on your paycheck. Many employers will do this with no fee, though it reduces your next paycheck.
Frequently Asked Questions
What is the difference between a cash advance and a regular credit card purchase?
A purchase is a transaction with a merchant, and you have a grace period (usually 21 to 25 days) before interest starts. A cash advance is a loan from your card issuer, and interest starts when ready. Cash advances also charge an upfront fee and usually have a higher APR.
Can I use a credit card to withdraw cash from my own bank account?
No. A credit card withdrawal is always a cash advance — a loan from the card issuer, not access to your own money. Use your debit card or visit your bank to withdraw from your own account.
Do I have to pay back a cash advance right away?
No, but you should. The longer you carry the balance, the more interest you owe. Unlike a purchase with a grace period, interest on a cash advance starts accruing the day you withdraw it. Paying it back as soon as possible saves you money.
Will getting a cash advance hurt my credit score?
Not directly, but it can lower your score slightly by increasing your credit utilization. The real damage happens if you miss a payment on the cash advance balance. That missed payment will hurt your score much more than the advance itself.
Can I increase my cash advance limit?
Some card issuers allow you to request a higher limit, but many do not. Call the number on the back of your card and ask. Even if they say yes, remember that a higher limit just means you can borrow more money at an expensive rate — it does not make a cash advance a good deal.