Can you withdraw cash on a credit card?
Yes, but withdrawing cash on your card can be very costly, so you should avoid it in most circumstances.
Withdrawing £150 could come with fees of £8.90 even if you pay it back in full when you get your credit card bill.
Here is how to work out the cheapest way to borrow cash instead of using your credit card in an ATM.
Yes, some cards do not charge a fee for this and come with lower interest rates for withdrawing cash. You can compare cash advance credit cards here..
How can you withdraw cash on your credit card?
You can get cash on most credit cards in the following ways:
Using a cash machine
Going to your provider's branch to withdraw over the counter
Getting cashback when you pay in a shop*
What is a cash advance?
Withdrawing cash on your credit card can also be called a cash advance.
Some credit card companies also count the following as cash advances:
Making a mortgage payment
Paying your utility bills
Buying gift vouchers
Betting or gambling (including lottery tickets and most transactions in a casino)
Writing credit card cheques*
Ask your provider what transactions they count as a cash advance because you will be charged the same fees you would for withdrawing cash.
How much does a cash advance cost?
Cash advance fee
Most credit cards charge a fee when you withdraw cash, which is calculated as a percentage of the amount you take out. They typically charge about 3%, so if you withdrew £100 you would be charged £3.
They also specify a minimum fee amount, often around £3 which would mean you would still be charged £3 even if you only withdrew £10.
A few cards come without a withdrawal fee, but others charge up to 5% with a minimum fee of £5.
The interest charged on cash advances is different to when you make a purchase on your card:
You will be charged interest on the amount you withdraw from the day you take it out until you pay off the balance.
With most purchases you will not be charged interest unless you do not pay your bill in full when it arrives, sometimes up to 56 days later.
The daily interest rate for cash advances is usually higher than the card's standard APR. A typical card has an APR of 17.99% for most purchases but will charge 27.9% on cash advances. The rate can be as high as 69.9%.
Here is an example of how much you would pay on a £150 cash withdrawal if you paid your bill 36 days after making your withdrawal:
|Interest charged (36 days)||£3.89|
|Cash advance fee||£5.01|
|Total you pay back||£158.90|
If you do not repay the amount you withdraw by the date it is due, you will also have to pay other fees and even more interest.
It can also affect your credit record
Cash advances show up on your credit record. Other lenders will see this when you apply for credit with them, including loans, mortgages and credit cards.
Seeing a cash advance on your record will not necessarily stop a lender from accepting your application.
However, some might think that you struggle to handle your finances if you have had to withdraw cash on your credit card. If you are planning to apply for a mortgage or large loan, avoid cash advances on your card to make sure you do not run the risk of putting off lenders.
How much cash can you withdraw?
Cash advances on your credit card usually have some of the following limits:
A minimum withdrawal amount, which is usually £10.
A daily withdrawal limit, which is the maximum you can get at an ATM each day (usually between £100 and £500). Some cards offer a larger limit if you take out cash in a branch instead.
A weekly or monthly limit: the maximum amount you can withdraw per week or month could be capped (for example £500).
Your total advance limit is a percentage* of your total credit limit that you can use towards cash advances. For example, if you had a credit limit of £2,000 and a 50% advance limit, you would not be able to have more than £1,000 of cash advances outstanding on your balance at any point (and no more than £2,000 owed in total).
You can usually withdraw as many times as you need as long as you do not go over your daily limit or your advance limit. However, withdrawing multiple times can be expensive as you will pay a fee each time.
How to save money on cash advances
Repay as soon as you can
Paying off the balance quickly means you will be charged less interest.
Here is an example of how much it would cost if you paid off a £150 cash withdrawal after 10, 20, 30 and 56 days after a cash advance:
|10 days||20 days||30 days||56 days|
You can make a payment to your card before you receive your bill. Here is how to repay your credit card.
Only make one withdrawal
You can save money on fees if you withdraw all of the cash you need in one go because you will be charged a fee each time you take out cash. Several trips to the cash machine will usually be more expensive than one larger withdrawal.
For example, ten £10 withdrawals would cost £30 in fees on a card with a 3% fee and £3 minimum. One £100 withdrawal would come with a fee of £3.
Use a card with low withdrawal fees
Some cards come without fees for cash withdrawals, and some have much lower interest rates on cash advances. Check what fees your card charges before you use a cash advance or use our comparison to choose a new one - it shows the fees and the APR on cash withdrawals for each card.
Withdrawing cash abroad
Withdrawing cash abroad can be expensive, but choosing the right card can cut the cost.
Here is how much it costs to use your card in another country and how to choose a card to use abroad.
Consider the alternatives
The best way to avoid expensive cash withdrawals is to never take out cash on your credit card.
If you have enough money in your bank account or can use your overdraft without being charged, it will be cheaper to withdraw cash on your debit card instead.
Use a money transfer instead
If you need a large amount of cash you could send money from your credit card to your bank account with a money transfer. These come without the fees and interest charges above because they do not count as cash withdrawals.
Once the funds arrive in your bank account you can pay your bills or withdraw cash from your bank account for free.
Money transfers come with a fee, usually costing 1.69% to 4%. However, you can get deals that give you more than three years to pay back the amount without charging any interest.