Credit cards have indeed become one of the most important financial tools. With increased features and benefits, credit cards are now more of a necessity than a luxury. Apart from letting you make payments at various online and offline merchant stores, credit cards also allow you to withdraw cash from an ATM just like a debit card does. However, the credit card cash withdrawal is not that simple. There are a lot of other details that you should consider before you go on with
credit card cash withdrawal. This blog will help you find out all that you need to. In technical terms, credit card cash withdrawal is referred to as ‘Credit Card Advance’. Using this facility, users can withdraw cash from an ATM using their credit card. However there are few points related to credit card cash withdrawal that you must note- Since credit card cash withdrawal is not a basic but an additional feature offered by banks, users have to pay extra charges on withdrawing cash using their credit card. These extra charges are termed as ‘credit card advance fee’. Every time a user withdraws cash using his/her credit card, a percentage of the amount withdrawn is charged as a cash advance fee. Wondering if there’s a Credit Card with Zero Charges on Cash Withdrawal? Well, wonder no more,
because Paytm Bank HDFC Credit Card offers zero charges on cash withdrawal of upto Rs. 10,000. Credit card cash withdrawal attracts financial charges. These charges vary between 2.5% and 3% of the total amount withdrawn, depending upon individual banks. The actual rate of interest on cash
advance varies from bank to bank and from one card type to another. It is important to note that the details related to credit card cash withdrawal are shared with the credit card holder at the time of issuing the credit card. Hence, it is strongly recommended to go through all the terms and conditions before buying a credit card to avoid any
unwanted surprises later. Let’s take a look at some of the factors that define the finance charges on cash advances using a credit card-
How to Withdraw Cash Using a Credit Card?Withdrawing cash using a credit card is as simple as it could be. Just like you do with a debit card, you need to follow the same process with a credit card as well. Simply, visit an ATM near you, insert your credit card in the machine and follow the instructions that appear. However, there are a few points that you must note-
Does Credit Card Cash Withdrawal Affect Credit Score?While there may be a misconception that cash advances affect your credit score negatively, the truth is that cash advances have absolutely no effect on a user’s credit score. This is because the transactions of cash withdrawals are not separately to the credit agencies. They are simply recorded as any other transaction using a credit card. Hence, the credit score is totally neutral to any credit card cash withdrawal. However, because there are high interest rate charges on cash advances, along with additional fees and charges, levied on a daily basis, it may become difficult for you to keep up with the monthly payments. Eventually, when you fail to make payments of your monthly credit card bills or minimum amount due, your credit score will be affected and will reflect negatively in your credit report. As a solution, if you make timely payments of your credit card bills, your credit score won’t be affected irrespective of the number of cash withdrawals you make. Advantages of Credit Card AdvanceListed below are some of the benefits of making cash withdrawals using credit cards-
Disadvantages of Credit Card AdvanceExplained below are some of the reasons why you should avoid making cash advances, whenever possible-
To Conclude: While it is possible to withdraw cash using your credit card, you should still do it only once in a while. Unless urgent, you should not make credit card cash withdrawals as there is a huge price that you have to pay for such transactions, including finance charges, which is 2.5%-3% of the amount withdrawn, additional fees on withdrawing cash from other bank’s ATMs, etc. Moreover, cash advances do not have an interest-free period, which makes it all the more expensive. Apply For Credit Card FAQs What is credit card cash withdrawal? When you withdraw cash from an ATM using your credit card, it is termed as credit card cash withdrawal or cash advance. Is it okay to withdraw cash using a credit card? While it is okay to withdraw cash using a credit card, it is advised not to do so as it involves multiple additional charges, which makes such transactions quite expensive. Do all credit cards allow cash withdrawals? No, not all credit cards allow cash withdrawals. Credit card cash withdrawal is not a basic but an additional feature offered by various banks. Is there any limit on the amount of cash I can withdraw using my credit card? How can I know the limit? Yes, there is a limit on the amount of cash that you can withdraw using your credit card. This limit is termed as ‘cash limit’. It can be found as one of the terms and conditions on the welcome kit. Alternatively, you can also check your credit card’s internet banking account. Is it possible to withdraw cash at another bank’s ATM? Yes, it is possible to withdraw cash at another bank’s ATM. However, you will have to pay an additional fee for such transactions. There might also be a limit on the minimum and maximum amount that you can withdraw.
Mehak Bagla is a financial Content Writer with over 3 years of work experience in the industry. She is a passionate writer with professional approach in digital marketing. In her spare time, Mehak loves to write, travel, and listen to music. Is there a way to withdraw money from a credit card?If you need to take money out of a credit card at an ATM, here's how to request a cash advance: Insert your credit card into an ATM. Enter your credit card PIN. Select the “cash withdrawal” or “cash advance” option.
Can you withdraw cash from a credit card at an ATM?If you're asking yourself “can you use a credit card at the ATM?", the answer is yes. Most credit card companies allow cardmembers to use their credit card at an ATM, which will show up as a cash advance on your credit card statement.
What is the best way to withdraw money from credit card?How to withdraw money from credit card?. First of all, ensure that you will be able to withdraw cash using your credit card.. Next, visit the nearest working ATM.. Now, insert your credit card into the card slot.. Proceed to enter your PIN.. Finally, you can withdraw the amount that you want to take out.. Can I withdraw money from credit card to bank?It is possible to use a credit card to transfer money into a bank account by using a cash advance or balance transfer check, but we can't recommend it. Cash advances are risky because of the high interest rates and costly one-time fees.
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