The three ways to get cash from a credit card
You can get cash from a credit card in three ways: a cash advance at an ATM or bank, a balance transfer check mailed to you, or a cash-like purchase through a money transfer service. Each one costs you differently and shows up differently on your bill.
A cash advance is the most direct route. You insert your card into an ATM (or ask a bank teller), enter your PIN, and withdraw cash up to your credit limit. The money hits your account when ready. But the bank charges you a fee — usually 3 to 5 percent of the amount withdrawn — and starts charging interest right away, with no grace period like you get on regular purchases.
Balance transfer checks work differently. Your card issuer mails you a check that draws against your credit line. You deposit it like any other check, and the amount appears as a balance on your card. These checks also carry an upfront fee and interest, though sometimes the interest rate is lower than a cash advance for a limited time.
Money transfer services like MoneyGram or Western Union let you send cash to yourself or someone else using your credit card. The card issuer treats it as a purchase rather than a cash advance, which can mean a lower fee, but you are still paying to move the money and the transaction may carry interest.
Key Takeaways
- Cash advances charge an upfront fee (usually 3 to 5 percent) plus interest that starts when ready, with no grace period.
- Interest rates on cash advances are typically higher than the rate on regular purchases, even if you have a good credit score.
- Balance transfer checks and money transfer services may have lower fees or promotional rates, but you should compare the total cost before choosing.
- The cash advance amount counts against your credit limit, so withdrawing $500 leaves you $500 less to spend on regular purchases.
Why cash advances are expensive
The cost of a cash advance comes from three places: the upfront fee, the interest rate, and the fact that interest starts accruing when ready. On a $500 cash advance, a 5 percent fee costs you $25 right away. Then interest begins the same day — there is no 21-day grace period like there is on a regular purchase.
The interest rate itself is usually higher than your regular purchase APR. If your card charges 18 percent APR on purchases, the cash advance rate might be 24 or 25 percent. That difference matters fast. After one month, that $500 advance at 25 percent costs you about $10 in interest alone, on top of the $25 fee you already paid.
If you carry the balance for several months, the interest compounds. A $500 cash advance at 25 percent APR costs roughly $125 in interest over six months if you make no payments. Add the $25 upfront fee and you have paid $150 to borrow $500 — a 30 percent total cost.
Balance transfer checks and promotional rates
Some card issuers offer balance transfer checks with a lower introductory rate — sometimes 0 percent for 6 to 12 months. If your card includes this offer, a balance transfer check can be cheaper than a cash advance, as long as you pay off the balance before the promotional period ends.
Read the fine print carefully. The 0 percent rate usually applies only if you use the check within a certain window (often 60 days of receiving it). After the promotional period, the rate jumps to the regular APR, which can be 20 percent or higher. There is also an upfront fee, typically 3 to 5 percent, charged when you deposit the check.
The math on a $500 balance transfer check at 0 percent for 12 months with a 3 percent fee: you pay $15 upfront, then $0 in interest if you pay it off within the year. Compare that to a cash advance at 5 percent fee plus 25 percent APR, which costs $25 plus roughly $125 in interest over the same period. The balance transfer check saves you about $135 — but only if you pay it off before the rate jumps.
Money transfer services as an alternative
Services like MoneyGram and Western Union let you send money to yourself or someone else using your credit card. The card issuer typically treats this as a purchase rather than a cash advance, which means the fee might be lower and the interest rate might be your regular purchase APR instead of the higher cash advance rate.
However, the money transfer service itself charges a separate fee — usually $5 to $20 depending on the amount. So you are paying both the card issuer's fee (if any) and the service's fee. For a $500 transfer, you might pay $10 to $15 to the service plus whatever the card issuer charges. The total cost can still be less than a cash advance, but you need to ask both the card issuer and the service what they charge before you proceed.
This option makes sense if you need to send money to someone else anyway. If you just need cash for yourself, a cash advance or balance transfer check is usually simpler.
How cash advances affect your credit score
A cash advance does not directly hurt your credit score the way a late payment does. However, it can indirectly damage your score in two ways: it raises your credit utilization ratio, and it signals to lenders that you are borrowing against your credit line.
Your credit utilization ratio is the percentage of your available credit that you are using. If you have a $5,000 credit limit and you take a $500 cash advance, your utilization jumps to 10 percent. Credit scoring models treat high utilization as a sign of financial stress, and scores drop when utilization climbs above 30 percent. The higher you go, the bigger the hit.
Lenders also notice cash advances when they review your credit report. A pattern of cash advances can signal that you are short on cash, which makes lenders less willing to offer you new credit or lower rates. One cash advance is unlikely to cause problems, but repeated advances over time can affect your ability to borrow.
When a cash advance might make sense
A cash advance is expensive, but there are situations where it is the least bad option. If you need cash urgently and have no other way to get it — no savings, no friends or family to borrow from, no paycheck coming soon — a cash advance gets you money when ready. The fee and interest are real costs, but they might be less painful than the alternative (like a late bill payment or a bounced check).
A cash advance also makes sense if you are paying off the balance quickly. If you take out $300 and pay it back within two weeks, the interest cost is minimal — maybe $5 or $6. The $15 fee (at 5 percent) is still annoying, but the total damage is contained.
Before you take a cash advance, ask yourself: Is there any other way to get this money? Could you wait for your next paycheck? Could you borrow from someone? Could you use a personal loan instead? A personal loan typically charges less interest than a cash advance and does not count against your credit limit. If you have time to explore other options, do it.
Comparing the total cost of each method
| Method | Upfront Fee | Interest Rate | When Interest Starts | Best For |
|---|---|---|---|---|
| Cash Advance at ATM | 3–5% of amount | Usually 20–25% APR | when ready (no grace period) | Urgent cash needs; paying back within weeks |
| Balance Transfer Check | 3–5% of amount | 0% intro rate (6–12 months), then 18–25% APR | After intro period ends | Larger amounts you can pay off within the intro period |
| Money Transfer Service | Service fee $5–$20 + card issuer fee (if any) | Regular purchase APR (usually lower than cash advance) | Depends on card terms | Sending money to someone else; lower fees than cash advance |
Frequently Asked Questions
Can I use a credit card to withdraw cash at any ATM?
Most ATMs accept credit cards, but not all. Bank ATMs are most reliable. Some ATMs in convenience stores or casinos may decline your card or charge an additional fee on top of your card issuer's fee. Always check the ATM screen before you complete the transaction — it will show you the fee amount.
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, while a cash advance charges interest when ready. Cash advances also have a higher interest rate and an upfront fee. A regular purchase counts toward your rewards points (if your card has them); a cash advance typically does not.
Will a cash advance show up separately on my credit card bill?
Yes. Your statement will list the cash advance as a separate line item from your regular purchases. It will show the amount withdrawn, the fee charged, and the interest accrued. The balance is part of your total credit card balance and must be paid down like any other charge.
Can I get a cash advance if I am close to my credit limit?
Yes, but only up to the remaining available credit. If your limit is $5,000 and you have already charged $4,800, you can only withdraw $200 as a cash advance. The cash advance counts against your limit just like any other charge.
Is there a way to avoid the cash advance fee?
Not through your card issuer — the fee is built into the cash advance product. However, you can avoid the fee by not taking a cash advance. If you need cash, explore alternatives: a personal loan from a bank or credit union, a paycheck advance from your employer, or borrowing from friends or family.