What is a cash advance on a credit card?

A cash advance lets you borrow cash directly from your credit card's available credit — at an ATM, bank, or via a convenience check — but it costs more than a regular purchase: a per-transaction fee applies and interest starts accruing the same day with no grace period.

What counts as a cash advance

Issuers define cash advances broadly. Beyond ATM withdrawals and bank-teller transactions, most agreements also classify wire transfers, foreign currency purchases, traveler's checks, money orders, lottery tickets, and gambling chips as cash advances. Using a convenience check the issuer mails you also counts. The common thread: obtaining cash or a cash equivalent rather than paying a merchant.

Cost structure: fee + higher APR + no grace period

Cash advance fee — charged upfront, either a flat amount or a percentage of the withdrawal (whichever is greater), added to your balance immediately.
Higher APR — cash advances typically carry a higher rate than purchases, listed separately on your statement.
No grace period — interest accrues from the day the transaction posts, even if you normally pay in full.
ATM fee — an out-of-network ATM operator may charge an additional fee on top of the issuer's cash advance fee.

Cash advance limit vs. credit limit

Your cash advance limit is almost always lower than your total credit limit — a $5,000-limit card might allow only $500 in cash advances. Check your agreement or call your issuer before you need it; exceeding the limit triggers a declined transaction.

When a cash advance is (and isn't) appropriate

The CFPB advises considering cash advances carefully because of their higher costs. The combination — upfront fee, elevated APR, and immediate interest — can make even a small advance expensive if not repaid quickly. This page is informational and not financial advice.

What the rules say

A cash advance is a short-term loan against your card's available credit; issuers typically charge a higher interest rate than for purchases, and interest begins accruing immediately with no grace period. — CFPB — Withdraw cash from a credit card?
The CFPB's credit card definitions classify cash advances as obtaining cash via ATM, wire transfer, foreign currency, traveler's checks, money orders, lottery tickets, gambling chips, or access checks. — CFPB — Credit Card Contract Definitions
A cash advance fee is disclosed in the card's terms and may be a flat dollar amount, a percentage of the advance, or both. — CFPB — Regulation Z §1026.60

Key takeaways

A cash advance borrows cash from your credit limit — via ATM, bank, or convenience check.
Three costs stack: an upfront fee, a higher APR than purchases, and immediate interest with no grace period.
ATM operators may charge a separate fee on top of the issuer's fee.
Your cash advance limit is usually lower than your total credit limit — check before assuming availability.