What Is a Cash Advance on a Credit Card? | Capital One (2024)

A credit card cash advance is just what it sounds like: using a credit card to withdraw cash against the card’s credit line. A cash advance can offer flexibility, but it generally comes with additional fees and higher interest rates than typical credit card purchases. Other types of transactions can also be considered cash advances, such as money transfers via apps like PayPal® and Venmo.

Learn more about getting a cash advance on a credit card, how much it may cost and possible alternatives.

What you’ll learn:

• Credit card cash advances allow cardholders to borrow money against their credit lines.
• Cash advances may come with fees and have higher interest rates than typical credit card purchases.
• You can typically get a credit card cash advance at a bank, at an ATM, by online transfer or by using a convenience check.
• Other types of transactions may be considered cash advances, including using a credit card to transfer money via apps like PayPal and Venmo, using a credit card to pay down debts like car loans and exchanging dollars for foreign currency.

Using a credit card to get a cash advance at a bank or an ATM is pretty straightforward. But credit card issuers might classify other transactions as cash advances, including:

• Peer-to-peer money transfers through apps like PayPal and Venmo
• Monthly bills paid with a credit card
• Loan payments on other debt, such as auto loans
• Wire transfers
• Traveler’s checks
• Money orders
• Foreign currency exchanges
• Lottery tickets
• Gaming chips and other wagers

If a transaction is classified as a cash advance, additional fees and interest rates could apply. You can check with your credit card issuer to learn more about its specific policies.

When a cardholder uses their credit card to get a cash advance, that amount is then added to their credit card balance. A credit card cash advance is different from getting cash using a debit card, which takes the funds from a person’s bank account.

Credit card cash advances typically come with higher interest rates than typical credit card purchases. They generally also involve fees. So, before getting a credit card cash advance, make sure you understand how much you’ll owe after interest and fees.

Depending on the credit card issuer, you may be able to get a cash advance by visiting your bank, withdrawing money at an ATM or writing a convenience check. Here’s a closer look at how these options work:

• Bank or credit union: Have a representative at a bank or credit union transact a cash advance using your credit card.
• ATM: Insert your card at an ATM, enter your PIN and follow the instructions on the screen.
• Convenience check: When you get a new credit card in the mail, your issuer may also send you blank convenience checks. You can fill out one of these checks and name yourself as the payee to get a cash advance. Then, you can either cash it or deposit it at your bank or other financial institution. But be sure to read the terms and conditions related to using convenience checks before choosing this option.

The amount you can take as a credit card cash advance may depend on your card issuer’s cash advance limits. You can typically find your limit by reviewing your card’s terms or checking your credit card statement. Keep in mind that if you’ve used all of your available credit on purchases, you may not be able to take out a cash advance even if you haven’t reached your cash advance limit.

You may also be able to change your card’s cash advance limit or deactivate cash advances altogether. It depends on your issuer’s policies.

When it comes to credit cards, interest and APR are often the same thing. Cash advances often come with a substantially higher APR than other types of purchases you make with the same card.

Plus, credit cards typically don’t offer a grace period on cash advances. This means you’ll likely start accruing interest immediately.

Cash advances can be an expensive way to access cash. Before getting a cash advance, consider the following:

• Check your account terms. That’s where you’ll typically find information about the cash advance APR and fees.
• Borrow as little cash from your credit card as possible. Minimizing the amount of cash you’re getting from your credit card can help you pay off your balance sooner. If you need a plan for paying down your balance, you might consider a debt repayment tactic like the debt snowball method or debt avalanche method.
• Consider how the cash advance might impact your credit. Your credit scores typically won’t be impacted if you’re prompt in repaying the cash advance. But cash advances can affect your credit utilization ratio, which is the amount of credit you’re using versus your total available credit. That means if the added balance of a cash advance goes unpaid for a while, it could hurt your credit scores.
• Talk to your lenders. If you’re thinking about using a cash advance to cover a loan payment, consider talking to your lender about other options first. Depending on the circ*mstances, they may be willing to work with you to change your payment date, make a repayment plan, or extend or defer your payment.

If you’re undecided about a credit card cash advance, there might be other ways to access cash. Here are a few options to consider:

• Use a debit card to access funds from your checking account.
• Investigate personal loans.
• Withdraw the funds from your savings account or emergency fund.
• Borrow money from family or friends.

A credit card cash advance may seem like a convenient way to access cash if you don’t have it readily available. But it’s typically more expensive than making other types of purchases with your credit card. That’s why it’s important to understand what qualifies as a cash advance, how cash advances work, how to use them responsibly and what potential costs you could end up paying.

You may also want to explore the variety of benefits that come with the right credit card, including cash back on everyday purchases. You can compare Capital One credit cards to find one that’s right for you.

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• Explore Capital One’s credit cards for building credit with responsible use.